REPORT 

OF  THE 


SECRETARY  OF  THE  TREASURY 


TO  THE 


PRESIDENT 


ON  THE 


SECOND  PAN  AMERICAN 
FINANCIAL  CONFERENCE 
AT  WASHINGTON,  JANU- 
ARY 19-24,  1920. 


CONVENED  UNDER  AUTHORITY  OF  PUBLIC  ACT  379  OF  THE 
SIXTY-FOURTH  CONGRESS. 


WASHINGTON 

GOVERNMENT  PRINTING  OFFICE 
1921 


REPORT 


OF  THE 


SECRETARY  OF  THE  TREASURY 


TO  THE 


PRESIDENT 


ON  THE 


SECOND  PAN  AMERICAN 
FINANCIAL  CONFERENCE 
AT  WASHINGTON,  JANU- 
ARY 19-24,  1920. 


CONVENED  UNDER  AUTHORITY  OF  PUBLIC  ACT  379  OF  THE 
SIXTY-FOURTH  CONGRESS. 


WASHINGTON 

GOVERNMENT  PRINTING  OFFICE 
1921 


THE  SECOND  PAN  AMERICAN  FINANCIAL  CONFERENCE. 


REPORT  OF  THE   SECRETARY   OF  THE   TREASURY   TO 
THE  PRESIDENT. 

SIR  :  Under  authority  of  Public  Act  379  of  the  Sixty-fourth  Con- 
gress,1 and  by  your  direction,  the  Department  of  State  invited  the 
Governments  of  Mexico,  Central  and  South  America,  and  the  Repub- 
lics of  the  West  Indies  to  be  represented  at  a  Second  Pan  American 
Financial  Congress  to  be  held  at  Washington  from  the  12th  to  the 
17th  of  January,  1920.  All  the  Governments  to  which  the  invitation 
was  sent  accepted,  and  most  of  them,  with  a  view  to  contribute  to 
the  fullest  extent  to  the  success  of  the  conference,  indicated  their 
willingness  to  send  as  chairmen  of  their  delegations  their  ministers 
of  finance.  Whether  or  not  circumstances  permitted  the  ministers 
of  finance  to  absent  themselves  from  home  for  the  duration  of  the 
conference  and  the  voyage  to  and  from  the  United  States,  these 
eminent  financial  officers  of  government  were  uniformly  and  sin- 
cerely interested  in  the  purposes  of  the  conference,  as  shown  by  their 
success  in  setting  on  foot  preliminary  examinations  of  its  program 
by  representative  financiers  and  jurists.  This  program,  in  tentative 
form,  had  been  distributed  among  the  ministers  of  finance  in  June, 
1919.  In  the  course  of  the  next  few  months  various  suggestions  were 
received,  some  from  the  ministers  of  finance  and  some  from  persons 
in  the  United  States  who  had  been  consulted.  These  suggestions 
were  found  acceptable  and  incorporated  in  the  final  program,  which 
was  circulated  in  the  late  fall  of  1919.  The  delegates  named  by  the 
Governments  were  in  nearly  all  cases  furnished  with  the  revised 
edition  before  their  departure  from  their  several  capitals. 

1  The  President  is  authorized  to  extend  to  the  Governments  of  Central  and  South 
America  an  invitation  to  be  represented  by  their  ministers  of  finance  and  leading  bankers, 
not  exceeding  three  in  number  in  each  case,  to  attend  the  Second  Pan  American  Finan- 
cial Conference  in  the  city  of  Washington,  at.  such  date  as  shall  be  determined  by  the 
President,  with  a  view  to  carrying  on  the  work  initiated  at  the  First  Pan  American 
Financial  Conference  and  establishing  closer  and  more  satisfactory  financial  relations 
between  their  countries  and  the  United  States  of  America,  and  authority  is  given  to  the 
Secretary  of  the  Treasury  to  invite,  in  his  discretion,  representative  citizens*  of  the 
United  States  to  participate  in  the  said  conference,  and  for  the  purpose  of  meeting 
such  actual  and  necessary  expenses  as  may  be  incidental  to  the  meeting  of  said  con- 
ference and  for  the  entertainment  of  the  foreign  delegates  during  the  conference,  to  be 
expended  under  the  direction  of  the  Secretary  of  the  Treasury,  to  be  immediately  avail- 
able and  to  remain  available  until  expended,  $50,000. 

5 


6  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

Owing  to  the  irregular  and  altogether  inadequate  transportation 
facilities  between  a  number  of  the  American  Republics  and  the 
United  States,  several  delegations  found  it  impossible  to  reach  Wash- 
ington in  time  for  the  opening  of  the  conference,  and  it  became 
necessary  to  postpone  the  date  of  its  opening  one  week.  The  pre- 
liminary session  of  the  foreign  delegates  with  the  Secretary  of  the 
Treasury  took  place  on  Saturday  afternoon,  January  17,  1920,  in 
the  Hall  of  the  Americas  in  the  Pan  American  Union  Building,  and 
the  formal  inaugural  session  occurred  in  the  same  place  on  Monday, 
January  19.  The  conference  closed  its  plenary  sessions  on  Friday, 
January  23,  and  the  official  part  of  its  program  concluded  with  a 
banquet  tendered  to  the  delegations  by  the  Secretary  of  the  Treasury 
on  Saturday,  January  24,  and  with  another  banquet  tendered  to  them 
at  New  York  by  the  Pan  American  Society  of  the  United  States  on 
Tuesday,  January  27. 

The  work  of  the  conference  was  done,  generally  speaking,  in  much 
the  same  way  as  the  work  of  the  First  Pan  American  Financial  Con- 
ference, which  took  place  in  Washington  in  May,  1915.  There  were 
two  general  committees  composed  of  the  presiding  officers  of  the 
official  delegations  and  an  appropriate  number  of  citizens  of  the 
United  States.  The  first  of  these  general  committees  was  that  desig- 
nated to  collect  and  examine  all  resolutions  offered  by  other  com- 
mittees of  the  conference  directly,  or  by  delegates  to  the  conference 
in  its  general  sessions.  This  committee  submitted  a  report  embody- 
ing 18  resolutions,  which  now  constitute  the  formal  and  collective 
recommendations  of  the  official  delegations  to  the  conference,  made 
with  the  approval  of  the  296  United  States  citizens  who  served  as 
committeemen  and  to  whose  help  in  great  measure  must  be  attributed 
the  success  of  the  conference.  Although  the  time  of  year  was  hardly 
propitious  for  such  a  gathering,  either  because  of  the  inclemency  of 
weather  or  because  of  the  pressure  of  business  in  the  month  of  Janu- 
ary, these  gentlemen  put  aside  other  considerations  and  accepted  the 
invitation  to  serve  in  this  advisory  capacity. 

The  second  general  committee  was  designated  to  consider  all  the 
problems  of  communication  between  the  American  Republics,  in- 
cluding those  relating  to  maritime  transportation  facilities,  postal 
communications,  and  cable  and  wireless  facilities.  The  Hon.  Joshua 
W.  Alexander,  Secretary  of  Commerce,  acted  as  general  chairman  of 
this  committee  and  took  a  personal  and  constructive  part  in  its  work. 
A  report  embodying  the  conclusions  of  several  subcommittees  desig- 
nated to  examine  the  main  headings  enumerated  above  was  submitted 
to  the  conference  by  this  committee  and  given  its  formal  approval. 

In  addition  to  the  two  general  committees,  there  were  19  national 
or  "  group  conference  "  committees,  comprising,  in  each  case,  the  re- 
spective official  delegation  and  about  15  financiers,  economists,  engi- 


LETTER  OF  THE  SECRETARY  OF  THE  TREASURY.         7 

neers,  and  industrial  leaders  of  the  United  States  who  had  been 
selected  with  an  eye  to  the  particular  problems  before  the  respective 
committees,  so  far  as  these  problems  were  known  to  the  Treasury 
Department.  The  presiding  officers  of  the  official  delegations  be- 
came automatically  chairmen  of  the  group  conference  committees; 
they  had  associated  with  them,  as  vice  chairmen  in  some  cases,  the 
gentlemen  designated  by  the  Treasury  as  interim  chairmen  of 
those  representing  the  United  States  upon  the  several  commit- 
tees. They  likewise  enjoyed  the  enthusiastic  and  sustained  coopera- 
tion of  a  number  of  the  high  officials  of  the  Government,  mostly 
within  the  field  of  public  finance,  but,  in  several  notable  instances,  in 
other  executive  departments. 

It  will  be  seen  from  the  program  of  meetings  of  the  conference 
that  its  great  accomplishment  was  due  to  the  conference  commit- 
tees, which  met  almost  continuously  during  the  first  three  days  of 
the  conference.  The  Secretary  of  the  Navy  had  been  good  enough 
to  place  at  the  disposal  of  the  conference  a  number  of  convenient 
rooms  suited  for  the  accommodation  of  such  committees  in  the  new 
Navy  Building.  Here,  in  intimate  association  and  in  an  atmosphere 
conducive  to  the  utmost  degree  of  frankness,  the  program  of  the 
conference  was  discussed  systematically,  with  special  reference  to 
the  financial  problems  of  the  respective  countries. 

The  general  sessions  of  the  conference  were  held  at  night,  for  the 
most  part,  with  a  view  to  leave  the  day  as  free  as  possible  for  the 
meetings  of  the  committees.  There  were  delivered  at  the  general  ses- 
sions a  number  of  able  addresses  by  distinguished  delegates  and  citi- 
zens of  the  United  States.  To  these  general  sessions  were  invited 
persons  interested  in  Latin  America,  or  in  a  general  way  in  the  prob- 
lems confronting  the  conference. 

The  conference  was  a  gathering  primarily  for  intensive  labor  with 
less  time  or  taste  for  formality  on  the  one  hand,  or  diversion  on  the 
other,  than  is  sometimes  the  case  in  international  gatherings.  Never- 
theless, private  hospitality  found  numerous  opportunities  for  ex- 
pression during  the  week  of  the  conference,  while  the  deference  of  the 
Government  to  its  guests  was  significantly  demonstrated  in  the  recep- 
tion tendered  by  the  Secretary  of  State  and  Mrs.  Lansing  on  Wednes- 
day, January  21 ;  by  the  luncheon  to  the  delegates  on  Saturday,  Janu- 
ary 17 ;  and  to  the  delegations  and  conference  committeemen  on  Mon- 
day, January  19,  by  the  Secretary  of  the  Treasury  in  the  first  in- 
stance and  by  the  Federal  Reserve  Board  and  United  States  section 
of  the  International  High  Commission  in  the  second  instance;  and 
finally,  by  the  banquet  with  which  the  conference  closed  its  meetings 
in  Washington.  The  Secretary  of  the  Navy  again  added  greatly  to 
the  enjoyment  by  the  official  delegations  of  their  sojourn  in  this 
country  by  his  generous  invitation  to  them  to  be  the  guests  of  the 


8  SECOND  PAN  AMERICAN   FINANCIAL  CONFERENCE. 

Navy  at  Annapolis  on  Saturday,  January  24.  A  number  of  the  dele- 
gates and  members  of  their  families  took  occasion  of  early  arrival  in 
Washington  to  avail  themselves  of  an  invitation  to  visit  Mount  Vernon 
and  seek  inspiration  at  the  tomb  of  the  foremost  figure  of  our  War 
for  Independence,  whose  name  acquires  an  ever  greater  influence 
throughout  the  nations  of  this  hemisphere. 

The  secretary-general  of  the  conference,  in  accordance  with  the 
plan  approved  by  my  predecessor,  Mr.  Secretary  Glass,  has  gathered 
in  convenient  form  its  records,  including  the  proceedings  of  the 
sessions,  the  addresses,  the  reports  of  committees,  and  the  lists  of 
persons  in  attendance.  I  wish,  in  submitting  for  your  examination 
a  summary  of  this  material,  to  call  attention  to  three  considerations 
which  I  regard  of  paramount  importance. 

The  purpose  of  this  conference  was,  in  substance,  the  same  as  the 
purpose  of  the  First  Financial  Conference  in  1915.  The  Government 
of  the  United  States  felt  that  the  responsible  financial  officers  of  the 
several  American  Republics  had  much  in  common  in  facing  the 
serious  problems  arising  from  the  adjustment  of  war  conditions,  that 
they  would  best  serve  the  interests  of  all  the  Governments  by  entering 
into  a  full  and  free  discussion  of  methods  of  solving  these  problems. 
The  first  conference  was  called  amid  the  impressions,  still  vivid  and 
even  painful,  of  the  initial  paralysis  of  international  communications, 
commerce,  and  finance  in  the  winter  of  1914-15.  It  was  necessary  to 
take  stock  of  the  resources  of  the  American  hemisphere  and  of  the 
equipment  for  their  development  and  enjoyment. 

Four  years  of  war  passed.  A  number  of  the  American  Republics 
were  drawn  into  the  struggle,  and,  stopping  at  no  sacrifice,  brought 
it  to  a  decisive  end.  The  American  Republics  felt  its  effect  with 
varying  degrees  of  directness  and  distress,  but  no  one  of  them  escaped 
a  serious  measure  of  economic  loss.  They  had  naturally  relied  upon 
the  financial  assistance  of  the  Old  World  in  the  development  of  their 
natural  resources,  while  they  had  welcomed  the  immigrant  who  chose 
to  leave  the  Old  World  and  seek  his  fortune  in  the  New.  The  war 
put  an  end  nearly  everywhere  to  the  flow  of  capital  and  labor  required 
not  merely  to  promote  the  development,  but  often  to  assure  the  sound- 
ness of  Latin- American  commerce  and  industry.  The  effect  of  four 
years  of  abnormal  economic  life,  of  industrial  undernourishment,  of 
apprehension,  of  insecurity  made  the  situation  confronting  the 
peoples  of  Central  and  South  America  at  the  close  of  the  conflict  even 
more  grave  than  it  had  been  in  1915.  The  development  of  sufficient 
resources  in  Europe  to  renew  the  arrested  development  in  South  and 
Central  America  could  not  safely  be  counted  upon  for  the  present. 
It  was,  therefore,  not  merely  expedient,  but  urgent,  that  the  effort  be 
made  by  the  American  Governments  to  survey  the  situation  and  to 


LETTER  OF  THE  SECRETARY  OF  THE  TREASURY.         9 

take  such  joint  or  several  measures  as  would  best  promote  their  indi- 
vidual and  common  interests. 

The  conference  of  1915  came  when  it  did  because  of  the  war ;  but 
there  is  good  reason  to  believe  that  abundant  cause  for  holding  such 
a  meeting  would  have  been  apparent  before  long,  even  if  the  great 
conflict  had  been  happily  averted.  The  developments  between  1915 
and  1920  strengthened  the  conviction  that  these  conferences  have  ful- 
filled a  natural  and  quite  definite  purpose.  It  is,  of  course,  to  be 
clearly  understood  that  in  inviting  eminent  business  men  of  the 
United  States  to  join  the  Secretary  of  the  Treasury  in  conferring 
with  the  ministers  of  finance  and  other  official  delegates  from  Mex- 
ico, Central  and  South  America  and  the  West  Indies,  our  Govern- 
ment had  no  intention  of  taking^  a  formal  and  responsible  part  in 
any  program  of  investment  and  financial  development  of  the  other 
countries. 

The  purpose  was  to  reinforce  the  conclusions  of  the  personal  con- 
ferences between  the  official  representatives  of  the  American  Repub- 
lics with  the  mature  opinions  of  citizens  of  this  country  whose  tech- 
nical knowledge,  training  in  public  finance,  or  experience,  warranted 
close  attention  to  their  views.  Out  of  such  first-hand  examination  of 
the  financial  problems  of  the  several  countries,  it  was  not  unreasonably 
expected  that  there  would  develop  among  the  members  of  the  group 
committees  an  abiding  and  constructive  interest  in  the  respective 
countries  with  which  they  were  concerned. 

From  the  foregoing  statement  the  fundamental  reasons  for  calling 
the  First  and  then  the  Second  Pan  American  Financial  Conference 
should  be  clear.  The  stimulus  of  good  relations  which  such  gather- 
ings can  not  but  afford  would  alone  have  justified  their  convocation, 
were  it  for  nothing  more  than  the  economic  advantages  in  due  course 
flowing  from  them.  But  something  larger  and  more  significant  was 
involved,  and  will  be  involved  in  other  conferences,  if  the  Congress 
shall  from  time  to  time  authorize  their  taking  place.  Our  bankers 
and  those  seeking  to  build  markets  for  export  trade  are  certain  to 
join  more  and  more  actively  in  defining  and  supporting  this  policy; 
and  as  a  consequence,  the  collection  and  diffusion  of  accurate  in- 
formation among  our  people  will  be  taken  up  with  redoubled  energy 
by  the  various  agencies  devoted  to  the  development  of  closer  rela- 
tions— cultural,  economic,  or  official — between  the  free  nations  of 
this  hemisphere.  The  outlay  on  the  part  of  the  Government  of 
energy,  time,  and  funds,  would  be  trifling,  regardless  of  the  number 
of  conferences  which  might  be  held,  if  the  fact  became  clearly  recog- 
nized by  the  people  of  the  United  States,  (1)  that  the  other  Ameri- 
can Republics  are  likely  to  become  more  and  more  important  markets 
in  which  to  sell  the  things  we  produce  and  to  buy  the  things  we 


10  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

need,  and  (2)  that  in  order  that  we  may  be  certain  to  enjoy  our 
opportunities  as  buyers  or  sellers  in  those  countries,  we  shall  have  to 
encourage  their  financial  and  industrial  expansion  as  best  we  may 
by  investment  and  other  appropriate  means. 

The  paramount  consideration  of  the  importance  of  Latin  Amer- 
ica as  an  investment  field  and  as  a  commercial  market  for  the  United 
States  has  two  corollary  aspects  to  which,  in  closing,  I  wish  briefly 
to  advert.  The  transportation  facilities  between  the  other  coun- 
tries and  the  United  States  have  never  been  what  they  should  have 
been,  largely  because  the  economic  demand  for  them  was  never 
pressing.  Europe  enjoyed,  and  even  yet  enjoys,  better  facilities 
than  the  United  States  in  all  branches  of  communication  with  the 
greater  part  of  Latin  America.  Whether  as  to  postal  facilities 
or  those  of  telegraph  and  radio  communication,  it  is  imperative 
that,  for  commercial  reasons  if  for  no  other,  measures  be  taken  to 
provide  for  the  independence  of  our  facilities  of  all  other  interests. 
As  to  the  lack  of  maritime  transportation  facilities,  so  much  evi- 
dence— some  of  it  of  a  costly  character — has  been  accumulated  dur- 
ing the  last  few  years  that  it  is  only  necessary  here  to  call  atten- 
tion to  the  repeated  emphasis  laid  by  the  conference  upon  an  im- 
provement in  this  regard  as  the  first  essential  in  promoting  our  re- 
lations with  Central  and  South  America  throughout  the  entire  con- 
ference. Hardly  a  committee  report  fails  to  urge  that  steps  be 
taken  with  the  least  possible  delay  to  correct  the  uncertainties  and 
insufficiencies  of  the  present  service.  The  rehabilitation  and  ex- 
tension of  land  transportation  facilities,  whether  by  rail  or  other- 
wise, is  hardly  less  strongly  stressed  as  a  prerequisite  of  the  open- 
ing up  of  new  resources  and  a  better  development  of  those  to  which 
access  is  already  possible. 

The  second  corollary  to  the  importance  of  closer  financial  rela- 
tions between  the  Republics  is  to  be  found  in  the  approval  with  which 
the  conference  regarded  the  work  of  the  Inter- American  High  Com- 
mission. The  first  conference  saw  the  need  of  a  continuing  body  of 
persons  eminent  in  their  respective  callings  and  acquainted  with  the 
national  problems  of  the  various  Republics,  which  would  undertake 
seriously  to  carry  out  its  own  recommendations.  Hitherto  no  special 
agency  had  been  set  up  to  give  effect  in  a  practical  way  to  the  recom- 
mendations of  intermittent  international  conferences.  It  was 
thought  that  a  group  of  financiers  and  jurists  in  each  country, 
closely  in  contact  with  the  minister  of  finance  and  engaged  in  con- 
stant correspondence  with  the  other  sections  and  with  some  central 
directive  body,  could  gradually  bring  to  an  advanced  stage  and,  in 
due  course,  to  realization  the  chief  points  enumerated  by  that  first 
conference  as  demanding  international  cooperation.  The  organiza- 


LETTEE  OF  THE  SECRETARY  OF  THE  TREASURY.        11 

tion  was  set  up,  and  at  an  important  meeting  in  Buenos  Aires,  it 
worked  out  a  procedure  by  which  it  proposed  to  accomplish  the 
things  for  which  it  was  established.  The  vice  chairman  of  the  com- 
mission laid  before  the  conference  on  January  20  a  record  of  its 
achievement  since  the  meeting  at  Buenos  Aires,  and,  in  accordance 
with  his  recommendation,  in  order  better  to  indicate  the  constituency 
and  significance  of  the  commission,  its  name  was  changed  from 
"  International  High  Commission  "  to  "  Inter-American  High  Com- 
mission." New  matters  were  intrusted  to  its  study  and  it  was  given 
encouragement  to  pursue  its  activity  with  reference  to  those  things  it 
had  taken  up  under  the  instruction  of  the  first  conference.  It  was 
unmistakably  apparent  that  at  least  one  successful  method  had  been 
found  for  international  cooperation  in  an  effective  way  in  technical 
matters  within  the  province  of  fiscal  administration,  commercial 
law,  and  public  finance.  The  setting  upon  a  new  and  broader  basis 
of  this  agency  in  all  the  Republics  seems  sure  and  can  not  but  serve 
to  remove  obstacles  in  the  way  of  ever  closer  and  stronger  financial 
and  commercial  relations. 

Respectfully, 

D.  F.  HOUSTON, 

Secretary. 
THE  PRESIDENT, 

The  White  House. 


REPORT  OF  THE  SECRETARY-GENERAL. 

JANUARY  23,  1920. 
The  honorable  the  SECRETARY  OF  THE  TREASURY. 

SIR  :  I  have  the  honor  to  report  to  you  that  the  Second  Pan  Amer- 
ican Financial  Conference  has  this  day  completed  its  survey  of  the 
topics  submitted  for  its  consideration.  There  have  been  in  attend- 
ance 53  delegates  from  19  of  the  American  Republics,  whose  diplo- 
matic representatives  at  Washington  have  likewise  been  the  guests 
of  the  Secretary  of  the  Treasury,  together  with  283  gentlemen  repre- 
sentative of  the  financial  and  industrial  communities  of  the  United 
States  whom  the  Secretary  of  the  Treasury  invited  to  join  him  in 
conferring  with  the  official  delegates.  The  deliberations  of  the  con- 
ference have  been  carried  out  in  five  general  sessions,  in  each  of 
which  formal  papers  were  submitted,  followed  by  informal  discus- 
sion. Twenty-one  committees  have  reviewed  the  agenda  of  the 
conference  over  a  period  of  three  days.  Of  these,  nineteen  were 
conference  committees,  each  taking  up  the  topics  agreed  upon  with 
particular  reference  to  one  of  the  republics  represented  in  the  con- 
ference. Two  of  these  committees  were  general  in  character.  One 
dealt  with  problems  of  communication,  including  ocean  and  land 
transportation,  and  postal,  cable,  and  radio  telegraphic  communica- 
tions. This  was  necessarily  the  case  in  view  of  the  international 
character  of  these  topics.  Finally,  the  committee  on  resolutions  has 
brought  together  all  the  conclusions  of  a  concrete  character  submitted 
to  the  conference  and  formulated  those  upon  which  it  has  seemed 
appropriate  that  the  conference  should  consider  a  formal  expression 
of  opinion. 

The  conclusions  of  the  conference  will  be  communicated  to  the 
several  participating  governments,  to  the  sections  of  the  Inter- 
American  High  Commission,  arid  to  others  directly  or  indirectly 
interested  therein. 

I  have  the  honor  to  state  that  no  further  business  requires  the 
attention  of  the  conference. 
Respectfully^ 

L.  S.  ROWE, 
Secretary -General. 
12 


RESOLUTIONS  ADOPTED  BY  THE  CONFERENCE,  JANU- 
ARY 23,  1920. 

I.  Resolved,  That,  with  a  view  more  definitely  to  indicate  the  con- 
stituency and  sphere  of  work  of  the  International  High  Commission, 
the  title  of  that  body  shall  hereafter  be  "  the  Inter- American  High 
Commission." 

II.  Resolved,  That  the  conference  adopts  that  part  of  the  report  of 
the  Committee  on  Transportation  and  Communication  relating  to 
maritime  transportation  and  directs  its  transmission  to  the  United 
States  Shipping  Board  for  consideration  and  action,  and  that,  so 
far  as  concerns  the  subjects  of  railroad  transportation,  postal  facili- 
ties, uniformity  of  bills  of  lading,  and  wireless,  cable,  and  telegraph 
communication  the   report  be  transmitted  to  the  Inter- American 
High  Commission  for  suitable  action. 

III.  Whereas  banks,  both  National  and  State,  in  the  United  States 
have  established  branches  in  various  Latin  American  countries;  and 

Whereas  restrictions  exist  under  the  laws  of  various  States  of  the 
United  States  which  in  effect  prevent  the  operation  of  branches  of 
foreign  banks  within  their  jurisdiction : 

Therefore  we  recommend  that  the  legislation  in  such  States  be  so 
modified  as  to  permit  the  establishment  of  branches  of  banks  of 
Latin  American  countries,  under  proper  regulations,  so  as  to  secure 
equality  of  treatment. 

IV.  Resolved,  That  the  Inter- American  High  Commission  be  re- 
quested to  study  the  question  of  the  possibility  of  achieving  uni- 
formity and  relative  equality  in  the  laws  and  regulations  governing 
the  organization  of  corporations  and  the  treatment  of  foreign  cor- 
porations in  the  various  American  Republics. 

V.  Resolved,  That  the  conference  recommends  the  increased  use 
of  acceptances  for  the  purpose  of  financial  transactions  involving 
the  importation  and  exportation  of  goods  and  hopes  that,  with  the 
passing  of  the  period  of  readjustment  in  which  nations  are  now  en- 
gaged, the  United  States  will  offer  a  constantly  widening  market 
for  the  long-term  securities  of  American  countries. 

VI.  Resolved,  That  the  Inter- American  High  Commission  be  re- 
quested to  continue  its  efforts  to  bring  about  the  adoption  of  the 
plan  recommended  at  Buenos  Aires  in  1916  for  the  establishment  of 
an  International  Gold  Fund,  such  plan  having  already  been  em- 
bodied in  a  convention  which  has  been  adopted  by  several  of  the 
American  Republics. 

13 


14  SECOND  PAN   AMERICAN   FINANCIAL   CONFERENCE. 

VII.  Resolved,  That  steps  having  heretofore  been  taken  to  bring 
about  the  adoption  by  the  American  countries  of  a  uniform  law  in 
regard  to  bills  of  exchange,  the  conference  requests  the  Inter- Amer- 
ican High  Commission  to  bring  to  the  notice  of  the  American  Gov- 
ernments the  desirability  of  adopting  a  uniform  law  on  the  subject 
of  checks. 

VIII.  Resolved,  That,  in  view  of  the  increase  and  diversification 
of  taxes  in  the  various  American  countries,  the  Inter- American  High 
Commission  be  asked  to  study  the  question  of  the  best  method  of 
avoiding  the  simultaneous  double  taxation  of  individuals  and  cor- 
porations as  between  such  countries. 

IX.  Whereas  the  International  Bureau,  at  Habana,  for  the  regis- 
tration of  trade-marks,  as  provided  in  the  convention  adopted  by  the 
Fourth  International  American  Conference  at  Buenos  Aires  in  1910, 
has  been  opened  and  is  in  successful  operation ; 

Resolved,  That  the  conference  recommends  the  early  ratification 
of  that  convention  by  all  the  American  countries  that  have  not  so  far 
ratified  it,  to  the  end  that  its  provisions  may  be  effective  throughout 
the  Americas. 

Meanwhile,  it  is  suggested  that,  pending  the  establishment  of 
the  International  Bureau  at  Rio  de  Janeiro,  consideration  be 
given  to  the  use  of  the  Habana  bureau  by  countries  of  the  south- 
ern group  that  have  ratified  the  convention. 

X.  Resolved,  That  the  conference  recommends  the  early  ratifica- 
tion by  the  American  Republics,  so  far  as  they  have  not  already  rati- 
fied it,  of  the  convention  adopted  by  the  International  American 
Conference  at  Buenos  Aires,  in  1910,  concerning  patents  and  copy- 
rights. 

XI.  Resolved,  That  the  conference  recommends  that  the  Webb  Law 
be  so  amended  as  to  permit  American  companies  importing  or  dealing 
in  raw  materials  produced  abroad  to  form,  under  proper  govern- 
mental regulations,  organizations  to  enable  such  companies  to  com- 
pete on  terms  of  equality  with  companies  of  other  countries  associated 
for  the  conduct  of  such  business. 

XII.  Resolved,  That  the  conference  recognizes  the  value  of  the 
services  of  commercial  attaches  and  strongly  urges  a  substantial 
extension  of  the  system. 

In  making  this  recommendation,  the  conference  intends  to  ex- 
press its  sense  of  the  importance  of  appropriate  training,  lin- 
guistic and  otherwise,  for  all  branches  of  the  foreign  service,  as 
a  means  of  developing  and  facilitating  commercial  and  financial 
relations. 

XIII.  Resolved,  That  a  simultaneous  census  should  be  taken  in  all 
the  American  countries  at  regular  intervals  not  exceeding  10  years, 


RESOLUTIONS   OF   THE    CONFERENCE.  15 

in  harmony  with  the  system  prevailing  in  the  United  States,  and  that 
uniformity  should  be  observed  in  the  preparation  of  statistical  works. 

XIV.  Resolved,  That  the  conference  recommends  that  the  metric 
system  of  weights  and  measures  be  universally  employed,  and  that 
pending  the  attainment  of  that  end  articles  weighed  and  marked,  and 
shipping  documents  prepared,  according  to  the  system  of  weights  and 
measures  now  prevailing  in  the  United  States,  should  be  accompanied 
with  statements  giving  the  equivalents  under  the  metric  system. 

XV.  Resolved.  That  the  plan  of  arbitration  of  commercial  disputes 
put  into  effect  between  the  Bolsa  de  Gomercio  of  Buenos  Aires  and 
the  United  States  Chamber  of  Commerce,  and  since  adopted  by  the 
chambers  of  commerce  of  several  other  American  countries,  should  be 
extended  to  all  the  American  countries,  and  that  legislation  should 
be  adopted  wherever  it  is  now  lacking  for  the  purpose  of  incorporat- 
ing the  arbitral  settlement  of  commercial  disputes  into  the  judicial 
system,  to  be  carried  out  under  the  supervision  of  the  courts. 

XVI.  Resolved,  That  the  Inter- American  High  Commission  be  re- 
quested to  study  the  question  of  the  creation  of  an  inter- American 
tribunal  for  the  adjustment  of  questions  of  a  commercial  or  financial 
nature  involving  two  or  more  American  countries,  and  the  deter- 
mination of  such  questions  on  principles  of  law  and  equity. 

XVII.  Resolved,  That,  it  being  in  the  interest  of  all  nations  that 
there  should  be  the  widest  possible  distribution  of  raw  materials,  the 
importation  of  such  materials  into  any  country  should  not  be  pre- 
vented by  prohibitive  duties. 

XVIII.  Resolved,  That  it  is  recommended  that  the  banking  inter- 
ests of  the  United  States  study  the  possibility  of  financial  relief  to 
Europe  by  repaying  Latin- American  obligations  held  in  Europe  by 
means  of  new  loans  granted  in  the  United  States  to  the  respective 
Latin- American  countries. 


RESERVATIONS  TO  RESOLUTIONS. 

II.  TRANSPORTATION. 

The  Bolivian  delegation  in  approving  the  second  resolution  of  the 
Conference,  makes  the  reservation  that  the  Inter-American  High 
Commission,  when  studying  the  subject  of  land  transportation,  shall 
take  into  consideration  the  Bolivian  propositon,  which  reads  as 
follows : 

In  order  that  the  Pan-American  Railroad  may  be  enabled  to 
fulfill  the  high  ideals  which  inspired  its  execution,  and  furnish 
overland  connection  between  all  the  countries  of  the  Americas, 
we  propose  that  a  transverse  line,  crossing  South  America  from 


16  SECOND  PAN  AMERICAN  FINANCIAL  CONFERENCE. 

east  to  west,  shall  be  considered  as  an  integral  part  of  that  same 
railroad,  and  that  for  this  purpose  the  lines  already  constructed 
may  be  utilized  so  far  as  possible. 

J.  L.  TEJADA. 

The  Brazilian  delegation  desires  to  make  a  reservation  in  similar 

terms. 

SAMPAIO. 

VI.  INTERNATIONAL  GOLD  CLEARANCE  FUND. 

The  Venezuelan  delegation  fails  to  approve  the  recommendation 
for  an  international  gold  clearance  fund,  because  Venezuela  needs 
more  specie  than  she  now  possesses  for  her  increased  business  activi- 
ties, which  should  be  stimulated  for  the  public  good,  and  also  because 
it  is  desirable  to  maintain  a  financial  balance.  Venezuela  can  not 
accept  the  draft  or  resolution  for  the  present. 

V.  LECUNA. 
VIII.  DOUBLE  TAXATION. 

Venezuela  agrees  to  a  single  system  of  taxation  of  individuals  and 
corporations,  provided  the  country  wherein  the  taxable  properties 
are  located  determines  the  kind  and  fixes  the  rate  of  taxation. 

V.  LECUNA. 
XI.  THE  WEBB  LAW. 

The  Venezuelan  delegation  fails  to  approve  the  recommendation 
relative  to  the  Webb  law,  because  it  considers  that  the  United  States 
is  the  country  to  pass  on  that  subject. 

V.  LECUNA. 

XVII.  RAW  MATERIALS. 

Venezuela  considers  that  each  country  should  retain  its  liberty  to 
protect  its  national  production,  where  it  is  desirable  so  to  do. 

V.  LECUNA. 

The  words  "Minerals  and  foodstuffs"  ought  to  be  incorporated, 
making  the  resolution  cover  "raw  materials,  minerals,  and  food- 
stuffs." 

SAMPAIO. 


LIST  OF  OFFICERS  OF  THE  CONFERENCE. 


PRESIDING  OFFICER. 

THE  SECRETARY  or  THE  TREASURY 
OF  THE  UNITED  STATES. 


HONORARY  PRESIDENTS. 

MINISTER  OF  FINANCE  OF  ARGENTINA. 
MINISTER  OF  FINANCE  OF  BOLIVIA. 
MINISTER  OF  FINANCE  OF  BRAZIL. 
MINISTER  OF  FINANCE  OF  CHILE. 
MINISTER  OF  FINANCE  OF  COLOMBIA. 
MINISTER  OF  FINANCE  OF  CUBA. 
MINISTER  OF  FINANCE  OF  DOMINICAN  REPUBLIC. 
MINISTER  OF  FINANCE  OF  ECUADOR. 
MINISTER  OF  FINANCE  OF  GUATEMALA. 
MINISTER  OF  FINANCE  OF  HAITI. 
MINISTER  OF  FINANCE  OF  HONDURAS. 
MINISTER  OF  FINANCE  OF  MEXICO. 
MINISTER  OF  FINANCE  OF  NICARAGUA. 
MINISTER  OF  FINANCE  OF  PANAMA. 
MINISTER  OF  FINANCE  OF  PARAGUAY. 
MINISTER  OF  FINANCE  OF  PERU. 
MINISTER  OF  FINANCE  OF  EL  SALVADOR. 
MINISTER  OF  FINANCE  OF  URUGUAY. 
MINISTER  OF  FINANCE  OF  VENEZUELA . 
14970—21 2  17 


VICE  PRESIDENTS. 

SENOR  DR.  DOMINGO  E.  SALABERRY,  Chairman,  Delegation  of  Ar- 
gentina. 

SENOR  DR.  JOSE  Luis  TEJADA,  Chairman,  Delegation  of  Bolivia. 

SENHOR  DR.  CARLOS  CESAR  DE  OLIVEIRA  SAMPAIO,  Chairman,  Delega- 
tion of  Brazil. 

SENOR  DR.  Luis  IZQUIERDO,  Chairman,  Delegation  of  Chile. 

SENOR  DR.  POMPONIO  GUZMAN,  Chairman,  Delegation  of  Colombia. 

SENOR  DR.  CARLOS  MANUEL  DE  CESPEDES,  Chairman,  Delegation  of 
Cuba. 

SENOR  DR.  Luis  GALVAN,  Chairman,  Delegation  of  the  Dominican  Re- 
public. 

SENOR  DR.  EAFAEL  H.  ELIZALDE,  Chairman,  Delegation  of  Ecuador. 

SENOR  DR.  Luis  TOLEDO  HERRARTE,  Chairman,  Delegation  of  Guate- 
mala. 

M.  FLEURY  FEQUIERE,  Chairman,  Delegation  of  Haiti. 

GEN.  JUAN  E.  PAREDES,  Chairman,  Delegation  of  Honduras. 

SENOR  ING°.  YGNACIO  BONILLAS,  Chairman,  Delegation  of  Mexico. 

SENOR  DR.  OCTAVIANO  CESAR,  Chairman,  Delegation  of  Nicaragua. 

SENOR  DR.  JOSE  AUGUSTIN  ARANGO,  Chairman,  Delegation  of  Panama. 

SENOR  DR.  EUSEBIO  AYALA,  Chairman,  Delegation  of  Paraguay. 

SENOR  DR.  FERNANDO  C.  FUCHS,  Chairman,  Delegation  of  Peru. 

SENOR  DR.  JOSE  ESPERANZA  SUAY,  Chairman,  Delegation  of  El  Sal- 
vador. 

SENOR  DR.  RICARDO  VECINO,  Chairman,  Delegation  of  Uruguay. 

SENOR  DR.  VICENTE  LECUNA,  Chairman,  Delegation  of  Venezuela. 

SECRETARY  GENERAL. 

L.  S.  ROWE. 

ASSISTANT   SECRETARIES    GENERAL. 

C.  E.  McGuiRE.  G.  A.  SHERWELL. 

SPECIAL  ASSISTANTS. 

BRANCH,  H.  N.  MURRAY,  J.  H. 

CORLISS,  J.  C.  OVALLE,  J.  Q. 

ENGLE,  M.  L.  PARKER,  J.  BROOKS  B. 

KIZER,  E.  D.  RICKARD,  J.  D. 

LuiTWEILER,  J.    C.  RlNGE,  H.  R. 

MCPHERSON,  C.  R.  THIESING,  T.  H. 

18 


LIST  OF  OFFICIAL  DELEGATIONS,  SPECIAL  GUESTS  OF 
THE  SECRETARY  OF  THE  TREASURY,  SPECIAL  REP- 
RESENTATIVES OF  THE  SECRETARY  OF  THE  TREAS- 
URY, AND  MEMBERS  OF  THE  COMMITTEES.1 


SPECIAL  GUESTS  OF  THE  SECRETARY  OF  THE  TREASURY. 


His  Excellency  the  AMBASSADOR  OF  ARGENTINA. 

His  Excellency  the  AMBASSADOR  OF  BRAZIL. 

His  Excellency  the  AMBASSADOR  OF  CHILE. 

His  Excellency  the  AMBASSADOR  OF  MEXICO. 

His  Excellency  the  AMBASSADOR  OF  PERU. 

The  MINISTER  OF  BOLIVIA. 

The  MINISTER  OF  COLOMBIA. 

The  MINISTER  OF  CUBA. 

The  MINISTER  OF  THE  DOMINICAN  REPUBLIC. 

The  MINISTER  OF  ECUADOR. 

The  MINISTER  OF  GUATEMALA. 

The  MINISTER  OF  HAITI. 

The  MINISTER  OF  HONDURAS. 

The  MINISTER  OF  NICARAGUA. 

The  MINISTER  OF  PANAMA. 

The  MINISTER  OF  PARAGUAY. 

The  MINISTER  OF  EL  SALVADOR. 

The  MINISTER  OF  URUGUAY. 

The  MINISTER  OF  VENEZUELA. 

1The  Hon.  John  Barrett,  Director  General  of  the  Pan  American  Union,  was  invited 
by  the  Secretary  of  the  Treasury  to  serve  as  a  member  of  all  the  group  committees, 

19 


COMMITTEE  ON  RESOLUTIONS. 


JOHN  BASSETT  MOORE,  of  New  York,  Chairman. 


Domingo  E.  Salaberry,  Argentina. 

Jose"  Luis  Tejada,  Bolivia. 

Carlos    C6sar    de    Oliveira    Sampaio, 

Brazil. 

Luis  Izquierdo,  Chile. 
Pomponio  Guzman,  Colombia. 
Carlos  Manuel  de  Ce*spedes,  Cuba. 
Luis  Galvan,  Dominican  Republic. 
Rafael  H.  Elizalde,  Ecuador. 
Luis  Toledo  Herrarte,  Guatemala. 
Fleury  Fequiere,  Haiti. 
Juan  E.  Paredes,  Honduras. 
Ygnacio  Bonillas,  Mexico. 
Octaviano  C6sar,  Nicaragua. 
Jose"  Agustfn  Arango,  Panama. 
Eusebio  Ayala,  Paraguay. 
Fernando  C.  Fuchs,  Peru. 


Jose1  Esperanza  Suay,  Salvador. 

Ricardo  Vecino,  Uruguay. 

Vicente  Lecuna,  Venezuela. 

John  Barrett,  of  the  District  of  Colum- 
bia. 

Franklin  Q.  Brown,  of  New  York. 

Frederick  A.  Delano,  of  the  District  of 
Columbia. 

John  H.  Fahey,  of  Massachusetts. 

Charles  S.  Hamlin,  of  the  District  of 
Columbia. 

Archibald  Kains,  of  New  York. 

Eugene  Meyer,  Jr.,  of  New  York. 

Andrew  J.  Peters,  of  Massachusetts. 

W.  S.  Rowe,  of  Ohio. 

Frank  A.  Vanderlip,  of  New  York. 

Paul  M.  Warburg,  of  New  York. 


THEODORE  H.  THIESING,  of  New  York,  Secretary. 
COMMITTEE  ON   TRANSPORTATION   AND    COMMUNICATIONS. 

JOSHUA  W.  ALEXANDER,  of  Missouri,  Chairman. 


Ricardo  C.  Aldao,  Argentina. 

Ricardo  Martinez  Vargas,  Bolivia. 

Carlos  C£sar  de  Oliveira  Sampaio, 
Brazil. 

Alberto  Edwards,  Chile. 

Tomas  Surf  Salcedo,  Colombia. 

Luis  Gonzalez  de  Mendoza  y  Freyre  de 
Andrade,  Cuba. 

Arthur  B.  Mayo,  Dominican  Republic. 

Luis  Felipe  Borja,  Ecuador. 

Manual  Echeverrfa  y  Vidaurre,  Guate- 
mala. 

Horace  Etheart,  Haiti. 

Ignacio  Agurcia,  Honduras. 

Bartolome1  Carbajal  y  Rosas.  Mexico. 

Adolfo  Cardenas,  Nicaragua. 

Luis  E.  Alfaro,  Panama. 

Rodney  Croskey,  Paraguay. 

Pedro  DAvalos  y  Lisson,  Peru. 

Reyes  Arrieta  Rossi,  Salvador. 

Florencio  AragOn  y  Etchart,  Uruguay. 

Enrique  Perez  Dupuy,  Venezuela. 

Admiral   W.  H.  G.  Bullard,  U.  S.  N. 

Ira  A.  Campbell,  of  New  York. 


E.  T.  Chamberlain,  of  the  District  of 
Columbia. 

Hendon  Chubb,  of  New  York. 

A.  H.  Dick,  of  New  York. 

James  A.  Farrell,  of  New  York. 

Herbert  Fleishhacker,  of  California. 

J.  P.  Grace,  of  New  York. 

Walker  D.  Hines,  of  New  York. 

E.  N.  Hurley,  of  Illinois. 

Julius  G.  Lay,  of  the  District  of  Co- 
lumbia. 

W.  G.  McAdoo,  of  New  York. 

Alfred  E.  Marling,  of  New  York. 

Frank  C.  Munson,  of  New  York. 

Walter  Parker,  of  Louisiana. 

C.  M.  Pepper,  of  New  York. 

T.  C.  Powell,  of  the  District  of  Colum- 
bia. 

Admiral  H.  H.  Rousseau,  U.  S.  N. 

J.  J.  Shirley,  of  New  York. 

Raymond  B.  Stevens,  of  New  Hamp- 
shire. 

Edwin  F.  Sweet,  of  Michigan. 


20 


JAMES  C.  CORLISS,  of  Massachusetts,  Secretary. 


ARGENTINA. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

His  EXCELLENCY,  DR.  DOMINGO  E.  SALABERRY,  MINISTER  or  FINANCE 

or  THE  ARGENTINE  REPUBLIC. 

DR.  RICARDO  C.  ALDAO. 

MR.  LUIS  E.  ZUBERBUHLER. 

Secretariat. 

MR.  ALEJANDRO  E.  BTJNGE,  Technical  Adviser. 

DR.  PEDRO  PALACIOS,  Secretary. 

MR.  EDUARDO  OCANTOS,  MR.  JACOBO  WAISHMAN,  MR.  FERNANDO  SAGTUIER,   JR., 

LIEUT.  A.  PARKER. 

Special  Guest  of  the  Secretary  of  the  Treasury. 

His   EXCELLENCY  THE   AMBASSADOR  or  THE   ARGENTINE   REPUBLIC 

AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 
HON.  W.  P.  G.  HARDING,  GOVERNOR  OF  THE  FEDERAL  RESERVE  BOARD. 

%    United  States  Members  of  the  Group  Committee. 

Frank  A.  Vanderlip,  of  New  York,  Chairman. 
Charles  H.  Bentley,  of  California. 
H.  E.  Byram,  of  Illinois. 
Hendon  Chubb,  of  New  York. 
F.  Abbott  Goodhue,  of  Massachusetts. 
E.  N.  Hurley,  of  Illinois. 
Ira  N.  Hollis,  of  Massachusetts. 
Archibald  Kains,  of  New  York. 
Edward  Dudley  Kenna,  of  New  York. 
Marc  M.  Michael,  of  New  York. 
Frank  C.  Munson,  of  New  York. 
Walter  Parker,  of  Louisiana. 
Andrew  J.  Peters,  of  Massachusetts. 
E.  R.  A.  Seligman,  of  New  York. 
Henry  L.  Janes,  of  New  York,  Secretary. 


BOLIVIA. 

CONFERENCE    COMMITTEE. 
Official  Delegation. 

DR.  JOSE  Luis  TEJADA  S. 
DR.  HERIBERTO  GUTIERREZ. 
DR.  RICARDO  MARTINEZ  VARGAS. 

Secretariat. 

MB.  ALBEBTO  CORTADELLAS,  First  Secretary. 

MB.  JOBGE  GUTIERREZ,  Secretary. 

MB.  EDUABDO  RIVAS,  Secretary. 

MR.  JORGE  DELGADO,  Commercial  Attached 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  .MINISTER  OF  BOLIVIA  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 
HON.  WALTER  W.  WARWICK,  COMPTROLLER  or  THE  TREASURY. 

United  States  Members  of  the  Group  Committee.. 

Joseph  P.  Grace,  of  New  York,  Chairman. 
Arthur  L.  Church,  of  Pennsylvania. 
J.  Rogers  Flannery,  of  Pennsylvania. 
Harry  F.  Guggenheim,  of  New  York. 
Arthur  M.  Harris,  of  New  York. 
John  Hughes,  of  New  York. 
Harrison  C.  Lewis,  of  New  York. 
Charles  M.  Pepper,  of  New  York. 
G.  C.  Poole,  of  New  York. 
Calvin  W.  Rice,  of  New  York. 
George  H.  Richards,  of  New  York. 
Henry  C.  Ulen,  of  New  York. 
Charles  Lyon  Chandler,  of  Pennsylvania,  Secretary. 


BRAZIL. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

DR.  CARLOS  CESAR  DE  OLIVEIRA  SAMPAIO. 
DB.  MANGEL  COELHO  RODBIGUES,  Legal  Adviser  and  Secretary. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
His  EXCELLENCY  THE  AMBASSADOR  OF  BRAZIL  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  ALBERT  STRAUSS,  VICE  GOVERNOR  OF  THE  FEDERAL  RESERVE 

BOARD. 

United  States  Members  of  the  Group  Committee. 

Oscar  T.  Crosby,  of  Virginia,  Chairman. 
Chandler  P.  Anderson,  of  the  District  of  Columbia. 
Joseph  H.  Bagley,  of  New  York. 
William  S.  Culbertson,  of  Kansas. 
Henry  S.  Dennison,  of  Massachusetts. 
A.  H.  Dick,  of  New  York. 
W.  Cameron  Forbes,  of  Massachusetts. 
Edward  S.  Huxley,  of  New  York. 
W.  S.  Kies,  of  New  York. 
Frederico  Lage,  of  New  York. 
F.  A.  Molitor,  of  New  York. 
A.  S.  Peabody,  of  Illinois. 
William  E.  Peck,  of  New  York. 
V.  H.  Pinckney,  of  California. 
Gerard  Swope,  of  New  York. 
Theodore  F.  Whitmarsh,  of  New  York. 
Percy  A.  Martin,  of  California,  Secretary. 

23 


CHIL*. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

DR.  LUIS  IzQUIERDO. 

DR.  SAMUEL  CLARO. 
DR.   ALBERTO   EDWARDS. 
DR.  VICTOR  V.  EOBLES. 

DE.  AETUBO  LAMAECA  BELLO,  Secretary. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
His  EXCELLENCY  THE  AMBASSADOR  or  CHILE  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 
HON.  EDWIN  F.  SWEET,  ASSISTANT  SECRETARY  or  COMMERCE. 

United  States  Members  of  the  Group  Committee. 
Paul  M.  Warburg,  of  New  York,  Chairman. 

Spruille  Braden,  of  New  York. 
Laurie  R.  Cofer,  of  California. 
Edward  P.  Costigan,  of  Colorado. 
Daniel  A.  de  Menocal,  of  Massachusetts. 
C.  H.  Ewing,  of  Pennsylvania. 
Andrew  Fletcher,  of  New  York. 
John  Hays  Hammond,  of  the  District  of  Columbia. 
N.  B.  Kelly,  of  Pennsylvania. 
F.  I.  Kent,  of  New  York. 
J.  C.  McKinley,  of  West  Virginia. 
M.  A.  Oudin  of  New  York. 
J.  Luis  Schaefer,  of  New  York. 
A.  H.  Titus,  of  New  York. 
Pope  Yeatman,  of  New  York. 
Verne  Leroy  Havens,  of  New  York,  Secretary. 
24 


COLOMBIA. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

His  EXCELLENCY,  DK.  POMPONIO  GUZMAN,  MINISTER  OF  FINANCE  or 

COLOMBIA. 

DR.  TOMAS  SURI  SALCEDO. 
MR.  EBNESTO  CoRTfssoz,  Attach^. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  COLOMBIA  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 
HON.  CHARLES  S.  HAMLIN,  OF  THE  FEDERAL  RESERVE  BOARD. 

United  States  Members  of  the  Group  Committee. 

Wallace  D.  Simmons,  of  Missouri,  Chairman. 
Joseph  G.  Brown,  of  North  Carolina. 
Maurice  Coster,  of  New  York. 

E.  A.  deLima,  of  New  York. 

F.  C.  Dillard,  of  Texas. 

John  Henry  Hammond,  of  New  York. 

George  H.  Kretz,  of  New  York. 

F.  Lavis,  of  New  York. 

J.  Ruperti,  of  New  York. 

L.  K.  Salsbury,  of  Tennessee. 

James  Brown  Scott,  of  Maryland. 

W.  R.  Shepherd,  of  New  York. 

George  M.  Shriver,  of  Maryland. 

R.  Lancaster  Williams,  of  Maryland. 

William  E.  Dunn,  of  New  York,  Secretary. 

26 


CUBA. 

CONFERENCE  COMMITTEE. 

Official  delegation. 

DR.  CARLOS  MANUEL  DE  CESPEDES,  MINISTER  or  CUBA  AT  WASHINGTON. 

MR.  Luis  GONZALEZ  DE  MENDOZA  Y  FREYRE  DE  ANDRADE. 

CORONEL  MANUEL  DESPAIGNE. 

MB.  POBFOBIO  BONET,  Secretary. 

Special  representative  of  the  Secretary  of  the  Treasury. 
HON.  ANGUS  MOL/EAN,  DIRECTOR  or  THE  WAR  FINANCE  CORPORATION. 

United  States  members  of  the  Group  Committee. 
Milton  C.  Elliott,  of  the  District  of  Columbia.  Acting  Chairman. 
Phanor  J.  Eder,  of  New  York. 
Philip  W.  Henry,  of  New  York. 
Charles  D.  Makepeace,  of  New  York. 
E.  M.  Patterson,  of  Pennsylvania. 
C.  A.  Phillips,  of  New  Hampshire. 
Levi  L.  Rue,  of  Pennsylvania. 
Frederick  Strauss,  of  New  York. 
Albert  E.  Tate,  of  North  Carolina. 
G.  C.  Taylor,  of  New  York. 
Henry  B.  Wilcox,  of  Maryland. 
William  H.  Woodin,  of  New  York. 
Robert  E.  Griffith,  of  the  District  of  Columbia,  Secretary. 
26 


DOMINICAN  REPUBLIC. 

CONFERENCE  COMMITTEE. 

Official  delegation. 

DR.  Luis  GALVAN,  MINISTER  OF  THE  DOMINICAN  REPUBLIC  AT 

WASHINGTON. 

Lieut.  Commander  Arthur  B.  Mayo,  United  States  Navy,  technical 

delegate. 

Special  representative  of  the  Secretary  of  the  Treasury. 
HON.  NORMAN  H.  DAVIS,  ASSISTANT  SECRETARY  OF  THE  TREASURY. 

United  States  members  of  the  Group  Committee. 

Charles  J.  Rhoads,  of  Pennsylvania.  Chairman. 
W.  D.  Anderson,  of  Pennsylvania. 
A.  F.  Dawson,  of  Iowa. 
F.  R.  Fairchild,  of  Connecticut. 
Paul  Fuller,  Jr.,  of  New  York. 
George  D.  Graves,  of  New  York. 
Chauncey  H.  Hand,  Jr.,  of  New  York. 
J.  T.  Holdsworth,  of  Pennsylvania. 
Frank  J.  R,  Mitchell,  of  New  York. 
Joseph  H.  O'Neil,  of  Massachusetts. 
Morris  K.  Parker,  of  New  York. 
Charles  T.  Plunkett,  of  Massachusetts. 
A.  Gonzalez  Lamas,  of  New  York,  Secretary. 

27 


ECUADOR. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

DR.  RAFAEL  H.  ELJZALDE,  MINISTER  OF  ECUADOR  AT  WASHINGTON. 

DR.  Luis  FELIPE  BORJA. 
MR.  GUSTAVO  R.  DE  YCAZA. 

/Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  HENRY  A.  MOEHLENPAH,  MEMBER  OF  THE  FEDERAL  RESERVE 

BOARD. 

United  States  Members  of  the  Group  Committee. 

E.  M.  Herr,  of  Pennsylvania,  Chairman. 
E.  M.  Borchard,  of  Connecticut. 
Harry  L.  Brown,  of  Massachusetts. 
O.  K.  Davis,  of  New  York. 
Fred  W.  Ellsworth,  of  Louisiana. 
Herbert  Fleishhacker,  of  California. 
Clifford  D.  Ham,  of  New  York. 
Robert  O.  Hayward,  of  New  York. 
George  de  B.  Keim,  of  Pennsylvania. 
Walter  H.  Lipe,  of  New  York. 
Benoni  Lockwood,  of  New  York. 
Howard  A.  Loeb,  of  Pennsylvania. 
John  McHugh,  of  New  York. 
George  H.  Prince,  of  Minnesota. 
J.  W.  Stoll,  of  Kentucky. 
Walter  M.  Van  Deusen,  of  New  York. 
Thomas  F.  Woodlock,  of  New  York. 
George  T.  Weitzel,  of  the  District  of  Columbia,  Secretary. 
28 


GUATEMALA. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

His  EXCELLENCY,  DR.  Luis  TOLEDO  HERRARTE,  MINISTER  or  FOREIGN 

AFFAIRS  OF  GUATEMALA. 

DR.  MANUEL  ECHEVERRIA  Y  VIDAURRE. 

DR.  VIRGILIO  RODRIGUEZ  BETETA. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  GUATEMALA  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  THOMAS  WALKER  PAGE,  VICE  CHAIRMAN  OF  THE  UNITED  STATES 

TARIFF  COMMISSION. 

United  States  Members  of  the  Group  Committee. 

John  Clausen,  of  Washington,  Chairman. 
A.  G.  Bates,  of  New  York. 
A.  C.  Burrage,  of  Massachusetts. 
L.  A.  Coolidge,  of  Massachusetts. 
F.  A.  Delano,  of  Illinois. 
John  L.  Dickey,  of  West  Virginia. 
A.  B.  Farquhar,  of  Pennsylvania. 
William  Fisher,  of  California. 
Samuel  Gompers,  of  the  District  of  Columbia. 
Roy  H.  Griffin,  of  New  York. 
Frank  K.  Houston,  of  Missouri. 
E.  W.  Kemmerer,  of  New  Jersey. 
A.  C.  Robinson,  of  Pennsylvania. 
George  S.  Wright,  of  Massachusetts. 
D.  G.  Munro,  of  New  Jersey,  Secretary. 

29 


HAITI. 

CONFERENCE  COMMITTEE. 
Official  Delegation. 

His  EXCELLENCY,  M.  FLEURY  FEQTJIERE,  MINISTER  OF  FINANCE 

OF  HAITI. 

M.  HORACE  ETHEART. 
M.  FERNAND  DENNIS. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  HAITI  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  D.  C.  BIGGS,  GOVERNOR  OF  THE  FEDERAL  RESERVE  BANK  or 

ST.  Louis. 

United  States  Members  of  the  Group  Committee. 

Edward  Hidden,  of  Missouri,  Chairman. 
Charles  J.  Andre,  of  Minnesota. 
L.  R.  Browne,  of  New  York. 
Paul  W.  Chapman,  of  New  York. 
J.  W.  Esmond,  of  Illinois. 
M.  B.  Lane,  of  Georgia. 
E.  S.  Lee,  of  Kentucky. 
Will  E.  Morris,  of  California. 
G.  A.  O'Reilly,  of  New  York. 
Joseph  E.  Otis,  of  Illinois. 
Gustave  Scholle,  of  the  District  of  Columbia. 
T.  Stebbins,  of  New  York. 
Arthur  H.  Wood,  of  New  Jersey. 
Julius  Goebel,  Jr.,  of  Illinois,  Secretary. 
30 


HONDURAS. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

GENERAL  JUAN  E.  PAREDES. 
DR.   ANTONIO  LOPEZ  VILLA. 
DR.  IGNACIO  AGURCIA! 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  HONDURAS  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  J.  U.  CALKINS,  GOVERNOR  OF  THE  FEDERAL  RESERVE  BANK  OF 

SAN  FRANCISCO. 

United  States  Members  of  the  Group  Committee. 

John  W.  Thomas,  of  Illinois,  Chairman. 
M.  F.  Backus,  of  Washington. 
James  M.  Barker,  of  Massachusetts. 
Charles  J.  Brand,  of  Pennsylvania. 
H.  K.  Brooks,  of  New  York. 
Victor  M.  Cutter,  of  Massachusetts. 
E.  H.  Darville,  of  New  York. 
Charles  de  la  Vasselais,  of  Louisiana. 
C.  T.  Owens,  of  Alabama. 
John  S.  Rossell,  of  Delaware. 
Samuel  Sachs,  of  New  York. 
C.  E.  W.  Smith,  of  New  York. 
Thomas  D.  Mott,  of  Indiana,  Secretary. 

31 


MEXICO. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

His  EXCELLENCY,  YGNACIO  BONILLAS,  AMBASSADOR  OF  MEXICO  AI 

WASHINGTON. 

DR.  ENRIQUE  MARTINEZ  SOBRAL. 
DR.  BARTOLOME  CARBAJAL  y  ROSAS. 

Secretariat. 

DR.  SALVADOR  URBINA. 
MB.  ALBERTO  CENTENO. 

MR.  JULIO  POULAT. 
MR.  FRANCISCO  VALDES. 

/Special  Representative  of  the  /Secretary  of  the  Treasury. 
HON  JOHN  SKELTON  WILLIAMS,  COMPTROLLER  OF  THE  CURRENCY. 

United  States  Members  of  the  Group  Committee. 

Robert  S.  Brookings,  of  Missouri,  Chairman. 
E.  N.  Brown,  of  New  York. 
Henry  Bruere,  of  New  York. 
Edward  W.  Decker,  of  Minnesota. 
John  S.  Drum,  of  California. 
S.  T.  Henry,  of  New  York. 
Alba  B.  Johnson,  of  Pennsylvania. 
William  H.  Knox,  of  New  York. 
George  L.  LeBlanc,  of  New  York. 
Theodore  C.  Lyster,  of  Mew  York. 
Robert  F.  Maddox,  of  Georgia. 
William  M.  Ritter,  of  Ohio. 
W.  L.  Sibert,  of  the  District  of  Columbia. 
G.  R.  Tuska,  of  New  York. 
Charles  H.  Cunningham,  of  Texas,  Secretary 
32 


NICARAGUA. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

His  EXCELLENCY  DR.  OCTAVIANO  CESAR,  MINISTER  OF  FINANCE  or 

NICARAGUA. 

DR.  ADOLFO  CARDENAS. 
MR.  A.  F.  LINDBERG. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  NICARAGUA  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 
HON.  A.  C.  MILLER,  OF  THE  FEDERAL  RESERVE  BOARD. 

United  States  Members  of  the  Group  Committee. 

W.  L.  Saunders,  of  New  York,  Chairman. 
J.  Gilmore  Fletcher,  of  New  York. 
Leslie  E.  Freeman,  of  New  York. 
Charles  J.  Gerstenberg,  of  New  York. 
Robert  N.  Harper,  of  the  District  of  Columbia. 
Walter  W.  Head,  of  Nebraska. 
Jeremiah  W.  Jenks,  of  New  York. 
S.  C.  Mead,  of  New  York. 
William  P.  Philips,  of  New  York. 
William  A.  Prendergrast,  of  New  York. 
Paul  S.  Reinsch,  of  Wisconsin. 
Charles  P.  Vaughan,  of  Pennsylvania. 
Sol  Wexler,  of  New  York. 
Elmer  H.  Youngman,  of  New  York. 
E.  D.  Kizer,  of  New  York,  Secretary. 

14970—21 3 


PANAMA. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

MR.  JOSE  AGUSTIN  ARANGO. 

DR.  Luis  E.  ALFARO. 
DR.  JUAN  NAVARRO  D£AZ. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  PANAMA  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  M.  B.  WELLBORN,  GOVERNOR  OF  THE  FEDERAL  RESERVE 
BANK  OF  ATLANTA. 

United  States  Members  of  the  Group  Committee. 

James  Brown,  of  New  York,  Chairman. 
Lindell  T.  Bates,  of  New  York. 
Henry  G.  Brengle,  of  Pennsylvania. 
Charles  Henry  Butler,  of  the  District  of  Columbia. 
Thomas  F.  Crean,  of  New  York. 
B.  S.  Cutler,  of  New  York. 
Nelson  A.  Gladding,  of  Indiana. 
J.  A.  House,  of  Ohio. 
George  L.  Hoxie,  of  New  Jersey. 
George  F.  Kunz,  of  New  York. 
George  Mixter,  of  New  York. 
Eugene  W.  Ong,  of  Massachusetts. 
Clarence  J.  Owens,  of  the  District  of  Columbia. 
Walter  S.  Penfield,  of  the  District  of  Columbia.  . 
G.  F.  Swain,  of  Massachusetts. 
A.  W.  Tedcastle,  of  Massachusetts. 
J.  G.  Eppinger,  of  Illinois,  Secretary. 
A.  I.  Hasskarl,  of  Nebraska,  Acting  Secretary. 
34 


PARAGUAY. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

His  EXCELLENCY  DR.  EUSEBIO  AYALA,  MINISTER  OF  FINANCE  OF 

PARAGUAY. 

MR.  RODNEY  CROSKEY. 
MR.  PEDRO  JORBA,  Jr. 

DR.  ENRIQUE  BORDENAVE,  Secretary. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  PARAGUAY  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  JULIUS  G.  LAY,  FOREIGN  TRADE  ADVISER,  THE  DEPARTMENT  OF 

STATE. 

United  States  Members  of  Group  Committee. 

Lewis  E.  Pierson,  of  New  York,  Chairman. 
C.  K.  Anderson,  of  Illinois. 
W.  E.  Aughinbaugh,  of  New  York. 
William  M.  Baldwin,  of  New  York. 
Dudley  Bartlett,  of  Pennsylvania. 
Constant  Cordier,  of  New  York. 
E.  M.  Haig,  of  New  York. 
Herbert  H.  Houston,  of  New  York. 
Nicholas  P.  Lloyd,  of  Pennsylvania. 
Richard  I.  Manning,  of  South  Carolina. 
J.  N.  G.  Nesbit,  of  New  York. 
John  S.  Pendleton,  of  New  York. 
Thomas  W.  Streeter,  of  New  York. 
Otto  Wilson,  of  the  District  of  Columbia,  Secretary. 

3* 


PERU. 

CONFERENCE  COMMITTEE. 


Official  Delegation. 

His  EXCELLENCY,  DR.  FERNANDO  C.  FUCHS,  MINISTER  OF  FINANCE  or 

PERU. 
DR.  PEDRO  DAVALOS  Y  LISSON. 

DR.  RlCARDO  BuLLEN. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
His  EXCELLENCY  THE  AMBASSADOR  OF  PERU  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 
HON.  GEORGE  W.  NORRIS,  FARM  LOAN  COMMISSIONER. 

United  States  Members  of  the  Group  Committee. 

John  H.  Fahey,  of  Massachusetts,  Chairman. 
Fred  Cardway,  of  New  York. 
John  Joy  Edson,  of  the  District  of  Columbia. 
Hollis  Godfrey,  of  Pennsylvania. 
William  C.  Gorgas,  of  New  York. 
Richard  S.  Hawes,  of  Missouri. 
Emory  R.  Johnson,  of  Pennsylvania. 
Alfred  Meyer,  of  New  York. 
C.  D.  Mitchell,  of  Tennessee. 
James  M.  Motley,  of  New  York. 
T.  C.  Powell,  of  the  District  of  Columbia. 
H.  Parker  Willis,  of  New  York. 
C.  M.  Woolley,  of  New  York. 
Harry  Erwin  Bard,  of  New  York,  Secretary. 
86 


SALVADOR. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 
His  EXCELLENCY,  DR.  JOSE  ESPERANZA  SUAY,  MINISTER  OF  FINANCE 

OF  SALVADOR. 
DR.  REYES  ARRIETA  Rossi. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  SALVADOR  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 
HON.  JAMES  H.  MOYLE,  ASSISTANT  SECRETARY  OF  THE  TREASURY. 

United  States  Members  of  the  Group  Committee. 

W.  S.  Rowe,  of  Ohio,  Chairman. 
J.  Howard  Ardrey,  of  New  York. 
John  P.  Frenzel,  Jr.,  of  Indiana. 
O.  C.  Fuller,  of  Wisconsin. 
George  H.  Harries,  of  New  York. 
J.  B.  Havre,  of  California. 
James  T.  Keena,  of  Michigan. 
George  C.  Luebbers,  of  New  York. 
George  E.  Macomber,  of  Maine. 
G.  A.  Northcott,  of  West  Virginia. 
Harry  Harwood  Rousseau,  of  the  District  of  Columbia. 
Dayton  Shelly,  of  Pennsylvania. 
Sidney  Story,  of  Michigan. 
Jerome  Thralls,  of  New  York. 
Charles  W.  Warden,  of  the  District  of  Columbia. 
Oscar  Wells,  of  Alabama. 
Walter  F.  McCaleb,  of  New  York,  Secretary. 

37 


URUGUAY. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

His  EXCELLENCY,  DR.  RICARDO  VECINO,  MINISTER  or  FINANCE  OF 

URUGUAY. 
DR.  JACOBO  VARELA  ACEVEDO,  MINISTER  OF  URUGUAY  AT  WASHINGTON. 

DR.  FLORENCIO  ARAGON  Y  ETCHART,  CHAIRMAN  OF  THE  FINANCE  COM- 
MITTEE OF  THE  URUGUAYAN  SENATE. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  EUGENE  MEYER,  MANAGING  DIRECTOR  OF  THE  WAR  FINANCE 

CORPORATION. 

United  /States  Members  of  the  Group  Committee. 

Harry  A.  Wheeler,  of  Illinois,  Chairman. 
Edward  Winslow  Ames,  of  New  York. 
William  C.  Buethe,  of  Illinois. 
Ira  A.  Campbell,  of  New  York. 
Paul  A.  Draper,  of  Massachusetts. 
Albert  W.  Harris,  of  Illinois. 
Samuel  M.  Lindsay,  of  New  York. 
R.JL.  McKellar,  of  Kentucky. 
Clarence  D.  Randall,  of  New  York. 
Welding  Ring,  of  New  York. 
James  J.  Shirley,  of  New  York. 
Glen  L.  Swiggett.  of  Tennessee. 
F.  H.  Taylor,  of  New  York. 
Eugene  P.  Thomas,  of  New  York. 
R.  E.  Tomlinson,  of  New  York. 

Alfredo  L.  Demorest,  of  the  District  of  Columbia,  Secretary. 
38 


VENEZUELA. 

CONFERENCE  COMMITTEE. 

Official  Delegation. 

DR.  VICENTE  LECUNA,  PRESIDENT  OF  THE  INTERNATIONAL  HIGH  COM- 
MISSION, NATIONAL  SECTION  OF  VENEZUELA. 
MR.  ENRIQUE  PEREZ  DUPUY. 
DR.  NICOLAS  VELOZ  GOITICOA. 

Special  Guest  of  the  Secretary  of  the  Treasury. 
THE  MINISTER  OF  VENEZUELA  AT  WASHINGTON. 

Special  Representative  of  the  Secretary  of  the  Treasury. 

HON.  J.  B.  McDouGAL,  GOVERNOR  OF  THE  FEDERAL  RESERVE  BANK  OF 

CHICAGO. 

United  States  Members  of  the  Group  Committee. 

Robert  H.  Patchin,  of  New  York,  Chairman. 
A.  C.  Bedford,  of  New  York. 
James  B.  Bonner,  of  the  District  of  Columbia. 
E.  G.  Buckland,  of  Connecticut. 
M.  J.  Caples,  of  Maryland. 
John  T.  Dismukes,  of  Florida. 
Charles  E.  Falconer,  of  Maryland. 
George  W.  Hyde,  of  Massachusetts. 
John  H.  Latane,  of  Maryland. 
Severo  Mallet-Prevost,  of  New  York. 
John  V.  Noel,  of  New  York. 
Robert  A.  Shaw,  of  New  York. 
S.  Davies  Warfield,  of  Maryland. 
William  P.  Wilson,  of  Pennsylvania. 
Clarence  H.  Haring,  of  Connecticut,  Secretary. 


PROGRAM  AND  SUMMARY  OF  THE  GENERAL  SESSIONS 
OF  THE  CONFERENCE. 

TOPICS  AGREED  UPON  BY  THE  GOVERNMENTS  OF  THE  AMERICAN  REPUBLICS 
FOR  SUBMISSION  TO  THE  SECOND  PAN  AMERICAN  FINANCIAL  CONFER- 
ENCE. 

/.  The  effect  of  the  war  on  the  commerce  and  industry,  manufactur- 
ing and  mining,  agriculture  and  public  utilities  of  the  Republics  of 
the  American  Continent. 

1.  To  what  extent  has  the  war  stimulated  the  development  of 
domestic  resources,  so  as  to  create  greater  economic  independence? 
To  what  extent  has  it  delayed  this  development  ? 

2.  Urgent  present  public  financial  needs— 

(a)  For  the  liquidation  or  funding  of  existing  financial  obli- 

gations. 

(b)  For  the  further  development  of  public  enterprises. 

3.  Urgent  present  financial  needs  in  commerce  and  industry. 

//.  How  can  required  capital  and  credit  facilities  best  be  provided f 

1.  To  what  extent  can  these  requirements  be  met  by  domestic 
capital? 

2.  To  what  extent  is  foreign  capital  required  ? 

(a)  The  extension  of  improved  banking  facilities,  through  the 
establishment  of  branches  and  by  other  means. 

(£>)  The  wider  use  of  acceptances  and  other  means  of  extend- 
ing credit. 

(c)  The  creation  of  a  market  for  the  distribution  of  foreign 

government  and  corporate  securities.     The  establish- 
ment of  investment  companies. 

(d)  The  direct  investment  of  capital  in  foreign  enterprises y 

industrial  and  commercial,  and  in  the  construction  of 
public  works. 

///.  National  credit  and  the  factors  affecting  it. 

1.  Extent  and  nature  of  the  public  debt. 

2.  The  national  fiscal  system,  with  special  reference  to  sources  and 
adequacy  of  revenues. 

40 


GENERAL   SESSIONS.  41 

3.  The  relation  of  the  fiscal  system  to  currency  reform. 

4.  What  guaranties  and  remedies  are  provided  by  law  in  the  case 
of  provincial  and  municipal  loans? 

IV.  The  effect  of  the  war  on  transportation  facilities — Requirements 

of  the  present  and  immediate  future. 

1.  To  what  extent  has  the  war  affected  transportation  facilities  on 
land  and  sea  ? 

2.  Laws  and  regulations  to  provide  for  the  encouragement  of  ship- 
ping facilities  between  the  American  Republics. 

3.  The  removal  of  obstacles  in  the  way  of  transportation  facilities, 
through  adequate  provision  for  lighthouses  and  other  aids  to  naviga- 
tion and  through  agreements  as  to  harbor  and  quarantine  regulations, 
entrance  and  clearance,  docking,  lading,  and  unlading  facilities. 

4.  Freight  rates. 

5.  Maritime  insurance  facilities. 

V.  Measures  to  facilitate  commercial  intercourse  among  the  American 

Republics. 

1.  The  convention  concerning  commercial  travelers. 

2.  The  convention  to  establish  an  international  gold  clearance  fund. 

3.  Parcel-post  facilities  and  lower  postal  rates. 

4.  Cable  facilities ;  wireless  telegraphy. 

5.  The  establishment  of  free  ports. 

6.  Improved  warehouse  facilities. 

VI.  The  development  of  uniformity  of  legislation  in  relation  to — 

1.  Uniform  customs  regulations ;  the  prevention  of  the  undervalua- 
tion of  merchandise  in  export  and  import  declarations. 

2.  Bills  of  exchange  and  checks;  bills  of  lading  and  warehouse 
receipts. 

3.  Contracts  regarding  the  consignment  of  merchandise  in  foreign 
trade  and  the  conditions  of  acceptance  or  rejection  of  merchandise. 

4.  Commercial  arbitration;  agreements  between  the  chambers  of 
commerce  of  the  American  Republics,  with  special  reference  to  the 
agreements  between  the  chambers  of  commerce  of  Buenos  Aires, 
Montevideo,  and  Guayaquil  and  the  Chamber  of  Commerce  of  the 
United  States. 

5.  Patent  and  copyright  law ;  the  protection  of  trade-marks,  espe- 
cially through  the  establishment  of  the  International  Trade-Mark 
Bureaus  at  Habana  and  Rio  de  Janeiro. 

6.  Uniform  admiralty  law. 


JOURNAL  OF  THE  SESSIONS. 


PRELIMINARY    MEETING    OF    THE    OFFICIAL    DELEGATES. 

An  informal  meeting  of  the  official  delegates  was  called  to  order 
at  3  p.  m.  Saturday,  January  17,  by  the  Secretary  of  the  Treasury  of 
the  United  States  in  the  Hall  of  the  Americas  of  the  Pan  American 
Building. 

On  motion  of  Dr.  Japobo  Yarela  Acevedo  (Uruguay),  the 
Secretary  of  the  Treasury  of  the  United  States,  L.  S.  Howe,  C.  E. 
McGuire,  and  G.  A.  Sherwell  were  elected  presiding  officer,  secre- 
tary general  and  assistant  secretaries  general,  respectively,  of  the 
conference. 

The  presiding  officer  announced  the  appointment  of  the  Hon. 
W.  G.  McAdoo  to  preside  at  the  second  general  session,  to  take 
place  on  January  20,  1920,  at  8.30  p.  m. 

Dr.  L.  Toledo  Herrarte  (Guatemala)  moved  that,  for  the  selection 
of  vice  chairmen  to  preside  at  the  first,  third,  fourth,  and  fifth 
general  sessions  of  the  conference,  the  American  countries  be  divided 
into  four  groups,  the  first  to  include  the  Caribbean  Republics;  the 
second,  the  South  American  countries  of  the  east  coast,  and  Colombia, 
Venezuela,  and  Paraguaj7;  the  third,  the  South  American  countries 
of  the  Pacific  coast,  including  Bolivia ;  and  the  fourth,  Mexico  and 
the  Central  American  countries.  The  vice  presidents  were  chosen 
by  ballot  as  follows:  For  the  Caribbean  countries,  Cuba;  for 
the  South  American  countries  of  the  Atlantic  coast,  Uruguay;  for 
the  South  American  countries  of  the  Pacific  coast,  Ecuador ;  and  for 
Mexico  and  the  Central  American  countries,  Honduras.  A  further 
ballot  determined  the  order  in  which  the  chairmen  of  these  four 
delegations  were  to  preside  at  the  general  sessions:  Cuba,  first; 
Uruguay,  third ;  Ecuador,  fourth ;  and  Honduras,  fifth. 

It  was  unanimously  agreed  that  at  the  opening  session  the  chairmen 
of  all  delegations  would  briefly  reply  to  the  address  of  welcome.  In 
the  general  sessions  papers  were  to  be  read  and  free  discussion  there- 
after invited,  previous  notice  of  an  intention  to  discuss  a  paper  being 
required  and  a  time  limit  of  10  minutes  imposed.  Those  taking  the 
floor  without  previous  notice  were  to  be  limited  to  5  minutes. 

The  secretary  general  announced  that  the  Federal  Reserve  Bank 
of  New  York  had  extended  an  invitation  to  the  official  delegates  to 
visit  the  bank  on  the  morning  of  January  27. 

The  meeting  was  adjourned  at  4.30  p.  m. 
42 


GENERAL  SESSIONS.  43 

OPENING   SESSION,  MONDAY,  JANUARY   19,   1920. 

The  conference  was  called  to  order  at  10.30  a.  m.  by  the  Hon. 
Carter  Glass,  Secretary  of  the  Treasury  of  the  United  States  and 
president  of  the  conference.  He  delivered  a  message  of  welcome 
from  the  President  of  the  United  States,  in  which  it  was  declared 
that  the  Republics  of  the  American  Continent  should,  in  the  troubled 
times  of  world  reconstruction,  seek  no  selfish  purpose,  but  continue 
to  be  guided  by  the  desire  to  serve  one  another  and  the  world.  To 
this  message  he  added  his  personal  greetings,  and  stated  briefly  the 
purpose  of  the  conference,  asserting  that  the  great  cause  of  conti- 
nental cooperation  made  necessary  the  personal  meeting  of  those 
high  in  the  financial  and  economic  affairs  of  their  country  so  as  to 
knowr  each  others'  views. 

The  Hon.  Robert  Lansing,  Secretary  of  State  of  the  United  States, 
expressed  his  personal  gratification  and  the  satisfaction  of  the  De- 
partment of  State  because  of  the  meeting,  and,  said  that  as  free 
peoples,  jealous  of  their  rights  as  nations  and  individuals,  the 
American  Republics  could  render  humanity  no  greater  service  than 
to  preserve  their  lofty  ideals  untouched  by  selfish  motives. 

The  Hon.  John  Barrett,  Director  of  the  Pan  American  Union, 
welcomed  the  delegates  on  behalf  of  the  Union. 

Responses  to  the  addresses  of  welcome  were  then  made  by  each  of 
the  foreign  delegates  in  alphapetical  order,  as  follows : 

Argentina — Dr.  Domingo  E.  Salaberry. 

Bolivia — Dr.  Jose  Luis  Tejada. 

Brazil — Dr.  Carlos  Cesar  cle  Oliveira  Sampaio. 

Chile — Dr.  Luis  Izquierdo. 

Colombia — Dr.  Tomas  Suri  Salcedo. 

Cuba — Dr.  Carlos  Manuel  de  Cespedes. 

Dominican  Republic — Dr.  Luis  Galvan. 
"  Ecuador— Dr.  Rafael  H.  Elizalde. 

Guatemala — Dr.  Luis  Toledo  Herrarte.. 

Haiti — M.  Fleury  Fequiere. 

Honduras — Gen.  Juan  E.  Paredes. 

Mexico — Dr.  Enrique  Martinez  Sobral. 

Nicaragua — Dr.  Octaviano  Cesar. 

Panama — Mr.  Jose  Agustin  Arango. 

Paraguay — Dr.  Eusebio  Ayala. 

Peru — Dr.  Fernando  C.  Fuchs. 

El  Salvador — Dr.  Jose  Esperanza  Suay. 

Uruguay — Dr.  Ricardo  Vecino. 

Venezuela — Dr.  Vicente  Lecuna. 

All  the  responses  expressed  hope  for  the  speedy  recovery  of  the 
President  of  the  United  States,  and  many  delegates  in  their  speeches 


44  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

placed  stress  on  the  results  of  the  work  of  the  First  Pan  American 
Financial  Conference. 

The  chairman  then  announced  the  membership  of  the  committee 
on  resolutions  and  the  committee  on  transportation,  whereupon,  at 
1.30  p.  m.  the  conference  took  a  recess. 

FIRST    GENERAL    SESSION,    MONDAY,    JANUARY    19,    1920. 

The  conference  was;  called  to  order  at  9  o'clock  p.  m.  by  the  lion. 
Carter  Glass,  who  turned  the  gavel  over  to  Dr.  Carlos  Manuel  de 
Cespedes,  minister  of  Cuba  at  Washington  and  chairman  of  the 
Cuban  delegation.  The  speeches  of  this  session  were  devoted  to  the 
discussion  of  "The  improvement  of  ocean  and  land  transportation 
facilities."  The  Hon.  John  Barton  Payne,  chairman  of  the  United 
States  Shipping  Board,  outlined  the  activities  of  the  Shipping  Board 
and  its  shipping  program  and  promised  adequate  passenger  and 
freight  service  between  the  United  States  and  the  Latin-American 
Republics.  This  formal  address  was  followed  by  brief  discussions 
of  the  transportation  problem  by  Dr.  Ricardo  C.  Aldao,  Argentina ; 
Dr.  Ricardo  Martinez  Vargas,  Bolivia ;  Dr.  Pomponio  Guzman,  Co- 
lombia; Dr.  Alberto  Edwards,  Chile;  Dr.  Luis  Felipe  Borja,  Ecua- 
dor; and  Mr.  Enrique  Perez  Dupuy,  Venezuela.  The  conference 
recessed  at  10.50  p.  m. 

SECOND  GENERAL   SESSION,  TUESDAY,   JANUARY    20,    1920. 

The  session  was  called  to  order  at  9.10  p.  m.  by  the  Hon.  William 
G.  McAdoo,  former  Secretary  of  the  Treasury  of  the  United  States, 
who,  after  extending  his  greetings  to  the  assembly,  dwelt  upon  the 
great  duties  and  responsibilities  now  imposed  on  the  countries  of 
this  hemisphere  as  a  result  of  the  war,  which  had  more  closely  united 
them.  He  pointed  out  that  this  closer  union,  political  as  well  as 
economic,  was  in  some  measure  due  to  the  practical  results  of  the 
First  Pan  American  Financial  Conference,  effected  through  the  sym- 
pathetic and  energetic  work  of  the  International  High  Commission, 
which  was  created  by  that  conference.  After  referring  to  the  strides 
which  had  been  made  by  the  several  American  Republics  in  the  ex- 
pansion of  their  foreign  commerce  and  shipping,  he  introduced  the 
Hon.  John  Bassett  Moore,  the  vice  president  of  the  central  executive 
council  of  the  International  High  Commission,  who  outlined  the 
work  accomplished  by  the  commission  since  its  creation  in  1915. 
Briefly  referring  to  the  organization  and  constituency  of  the  com- 
mission, Mr.  Moore  enumerated  the  subjects  taken  up  and  the  results 
accomplished  by  the  commission.  He  regarded  its  establishment  as 
a  matter  of  great  practical  significance.  It  had  supplied  the  need 
felt  by  numerous  scientific,  educational,  and  economic  Pan  American 
conferences  of  a  permanent  body  to  carry  out  their  resolutions. 


GENERAL   SESSIONS.  4$ 

THIRD    GENERAL    SESSION,    THURSDAY,    JANUARY    22,    1920. 


The  conference  was  called  to  order  at  10  a.  m.  by  the  presiding 
officer,  Dr.  Kaf  ael  H.  Elizalde,  chairman  of  the  delegation  of  Ecuador 
and  minister  of  Ecuador  at  Washington.  The  secretary  general  an- 
nounced the  dispatch  by  the  President  of  the  United  States  of  mes- 
sages to  the  Presidents  of  the  other  American  Republics  felicitating 
them  upon  the  inauguration"  of  the  conference. 

The  secretary  general  then  announced  that  most  of  the  group 
committee  reports  had  been  received  by  him.  These  reports  had 
been  drafted  after  having  been  given  serious  attention  for  sev- 
eral days  on  the  part  of  the  members  of  the  official  delegations  and 
the  groups  representing  the  United  States,  and  were  respectively 
signed  by  the  chairmen  and  vice  chairmen  of  the  conference  com- 
mittees, the  chairmen  being  the  heads  of  delegations  and  the  vice 
chairmen  being  the  persons  selected  by  the  Secretary  of  the  Treasury 
to  act  as  chairmen  of  the  group  committees. 

The  secretary  general  also  recorded  the  fact  that  the  report  of  the 
committee  on  communications  had  been  signed  by  the  Hon.  J.  W. 
Alexander,  Secretary  of  Commerce  and  chairman  of  the  committee, 
and  submitted  to  the  chair. 

All  the  reports  of  the  group  committees  and  committee  on  com- 
munications were,  by  direction  of  the  chair,  referred  to  the  committee 
on  resolutions  for  the  preparation  of  the  general  recommendations 
of  the  conference. 

The  Hon.  Huston  Thompson,  a  member  of  the  Federal  Trade  Com- 
mission of  the  United  States,  then  delivered  an  address  on  the  means 
of  preventing  unfair  competition  in  foreign  'trade.  Commissioner 
Thompson,  taking  as  his  text  the  provisions  in  Public  Act  126  of  the 
Sixty-fifth  Congress  (the  "  Webb-Pomerene  "  Act) ,  conferring  juris- 
diction on  the  Federal  Trade  Commission  in  cases  of  unfair  com- 
petition outside  the  jurisdiction  of  the  United  States,  devoted  his 
attention  to  the  more  important  types  of  unfair  competition  and  sug- 
gested an  international  commission  to  deal  with  this  matter. 

Mr.  Thompson  was  followed  by  Mr.  Luis  Zuberbuhler.  Mr.  Zuber- 
buhler  declared  that  the  expansion  of  foreign  trade  should  be  on  a 
permanent  and  stable  basis,  inasmuch  as  sound  and  enduring  com- 
mercial ties  can  exist  only  when  the  buyer  and  the  seller  fully  under- 
stand the  needs  of  each  other.  The  grasp  of  conditions  in  other  coun- 
tries can  come  only  through  long-continued  commercial  intercourse. 
He  pointed  out  that  there  is  no  greater  stimulus  to  foreign  trade  than 
the  constant  reinforcement  of  capital  from  the  country  which  de- 
sires that  trade,  and  he  showed  how  the  investments  of  Great 
Britain  had  proved  a  bulwark  to  her  trade  in  Latin  America. 
"The  only  kind  of  trade  that  is  capable  of  effective  and  sufficient 


46  SECOND   PAX    AMKRK'AX    FiXAXVIAL    CON  FKRKXCE. 

development,"  he  said,  "  is  that  which  rests  on  the  investment  of 
capital  in  the  enterprises  which  are  fundamental  to  the  progress  of 
the  Nation.  It  is  necessary,  in  consequence,  to  banish  any  attitude 
of  mind  which  looks  upon  the  consuming  market  as  something  merely 
incidental  and  occasional  in  character  and  suitable  for  the  inexpensive 
disposition  of  any  surplus  produced  originally  to  meet  the  require- 
ments and  tastes  of  the  domestic  market."  Dr.  Zuberbuhler  con- 
tinued with  reference  to  the  Webb  law,  to  the  fundamental  theory 
of  which  he  took  exception,  in  that  it  favored  combinations  of  capital 
for  foreign  trade  in  a  guise  regarded  as  illegal  in  domestic  trade. 

An  address  was  next  delivered  by  Dr.  Victor  Eobles,  a  member  of 
the  delegation  of  Chile,  a  member  of  the  House  of  Deputies  of  that 
Republic,  and  a  former  member  of  its  cabinet.  Dr.  Eobles  outlined 
the  situation  in  his  country  in  respect  of  nitrate,  coal,  and  agricul- 
tural production,  indicating  in  a  convincing  manner  how  safe  a  field 
for  investment  was  presented  in  Chile,  a  country  with  a  public  debt 
of  but  £32,000,000  sterling.  He  pointed  out  how  rapidly  the  prices 
of  the  products  of  Chile  had  increased  from  1914  to  1919,  and  the 
multiform  effects  produced  in  the  economic  life  of  his  country.  He 
concluded  his  detailed  survey  of  the  Chilean  economic  situation  with 
the  expression,  however,  that  the  American  Republics  should  strive 
to  make  concessions  mutually  advantageous  for  the  strengthening  of 
the  friendship  and  the  more  prosperous  development  of  the  commer- 
cial relations  between  the  several  countries.  "  Thus,  happily  joining 
reciprocal  guarantees  and  concessions,  interests,  and  even  affections, 
the  spirit  of  Pan  Americanism  will  become  a  lasting  and  attractive 
reality." 

The  session  adjourned  at  12.25  p.  m. 

FOURTH  GENERAL  SESSION,  THURSDAY,  JANUARY  22,   1920. 

The  conference  convened  at  3.35  p.  m.,  Secretary  Glass  in  the 
chair.  In  accordance  with  the  arrangement  reached  in  the  prelimi- 
nary meeting  held  on  January  17,  the  presidency  of  the  conference 
for  this  session  devolved  upon  His  Excellency  the  Minister  of  Fi- 
nance of  Uruguay,  Dr.  Ricardo  Vecino,  who,  at  the  invitation  of  the 
Secretary  of  the  Treasury,  took  the  chair. 

Upon  the  conclusion  of  routine  business  submitted  by  the  secre- 
tary general,  the  Hon.  Andrew  J.  Peters,  a  member  of  the  United 
States  section  of  the  commission,  and  mayor  of  Boston,  addressed 
the  conference  briefly,  extending  the  welcome  of  that  city  to  such 
delegates  of  the  conference  as  might  find  it  possible  to  visit  it. 

The  Hon.  Paul  M.  Warburg,  former  vice  governor  of  the  Federal 
Reserve  Board,  a  member  of  the  United  States  section  of  the  Inter- 
national High  Commission,  and  vice  chairman  of  the  conference  com- 


GENERAL   SESSIONS.  47 

mittee  for  Chile,  then  delivered  an  address  on  "  Fiscal  and  Currency 
Standards  as  the  Future  Measure  of  the  Credit  of  Nations." 

Particular  emphasis  was  laid  by  Mr.  Warburg  in  this  important 
address  on  several  topics  of  interest  to  the  conference. 

While  the  theory  of  banking  is  the  same  to-day  as  it  was  in  the  past,  in 
practice  its  most  fundamental  feature  has  been  almost  universally  aban- 
doned at  this  time. 

The  essential  characteristic  of  ante-bellum  banking  in  leading  countries- 
was  that  their  paper  circulation  and  their  deposit  liabilities  were  protected 
by,  and  therefore  kept  in  a  certain  relation  to,  large  gold  reserves  assembled 
in  their  central  banks.  These  central  institutions,  in  turn,  could  strengthen 
themselves  by  drawing  on  the  floating  gold  supply  carried  in  the  pockets  of 
the  people  and  in  the  vaults  of  the  banks,  or  by  collecting  their  holdings  of 
other  nations'  gold  obligations. 

A  gold  country  repudiating  its  obligation  to  pay  in  gold  would  have  been 
deemed  a  bankrupt,  and  a  country  permitting  the  existence  of  a  substantial 
gold  premium,  be  it  domestic  or  in  the  form  of  an  excessive  discount  on  its 
foreign  exchanges,  would  have  been  considered  as  being  headed  for  insolv- 
ency, a  condition  which  would  have  caused  widespread  alarm. 

The  fear  not  to  be  able  to  fulfill  their  gold  obligations,  the  wish  and  will, 
at  all  hazards,  to  ward  off  any  such  catastrophe,  was  the  strongest  direct- 
ing force  arid  regulator,  not  only  of  the  financial,  but  even  of  the  economic 
policies  of  such  countries.  Rather  than  to  expose  themselves  to  the  danger 
of  a  suspension  of  gold  payments,  they  would  resort  to  such  weapons  as 
high  discount  rates,  high  import  duties  or  taxes,  the  export  premium,  bor- 
rowing in  foreign  markets  on  even  onerous  terms,  or  to  any  other  means  of 
counteracting  demands  caused  by  an  overwhelmingly  adverse  trade  balance. 

The  war  brought  about  a  complete  reversal  of  these  doctrines  and  tra- 
ditions. 

The  danger  of  internal  and  external  gold  demands  thus  eliminated,  the 
protection  of  high  interest  rates  became  unnecessary  and  almost  all  belliger- 
ent countries  embarked  upon  an  era  of  Government  finance  based  upon  low 
interest  rates  born  of  inflation. 

This  enabled  the  countries  to  procure  the  domestic  goods  and  services 
needed  at  a  cheap  price  for  money,  but  at  high  prices  for  the  things  re- 
quired— people  imagining  that  they  were  escaping  taxation  when  they  were 
paying  it  in  its  most  drastic  and  most  inexorable  forYn,  by  the  depreciation 
of  money. 

The  belief  is  entertained  by  some  that  as  a  solution  of  our  difficulties 
we  are  likely  to  abandon  gold  as  the  future  means  of  ultimate  settlement 
of  international  balances.  I  do  not  believe  that  the  world  will  enjoy  fairly 
stable  standards  of  currency  and  credit  until  it  returns  to  the  observance 
of  approximately  the  same  principles  of  banking  and  finance  as  prevailed 
before  the  war. 

That  does  not  mean  that  I  foresee  that  antebellum  exchange  parities 
will  generally  be  reestablished.  Indeed,  I  hold  the  view  that  quite  a  number 
of  countries  will  never  regain  their  previous  exchange  levels.  Their  power 
to  reclaim  all  or  in  part  the  shrinkage  of  their  standards  will  depend  upon 
their  ability  to  produce  and  to  save,  and  upon  the  measure  of  permanent 
depreciation  sustained  during  the  war,  not  only  through  a  decrease  of  the 
value  of  their  property,  but  also  through  the  increase  of  their  national 
indebtedness.  But  whatever  the  level  they  may  be  able  to  recover,  ulti- 


48  SECOND   PAN   AMERICAN    FINANCIAL    CONFERENCE. 

mutely  it  will  be  to  their  vital  interest  once  more  to  fasten  it  to  a  definite 
gold  relation  and  to  reestablish  a  stable  exchange,  fluctuating  between  the 
maxima  and  minima  of  gold  parities,  without  which  a  country's  trade  and 
growth  will  remain  subjected  to  a  fatal  handicap.  (We  may  expect  some 
countries  to  aim  for  a  direct  return  to  a  free  gold  standard,  while  others 
may  have  to  choose  the  indirect  route  of  a  gold  exchange  standard.) 

Let  us  bear  in  mind,  however,  that  the  more  perfect  the  machinery  of 
credit,  the  more  insignificant  becomes  the  necessity  of  settling  in  actual 
gold. 

If  Governments  adopt  a  rigid  policy  of  preventing  the  further  issue  of 
Government  securities  and  money  for  the  purpose  of  covering  current  defi- 
ciencies, they  will  take  the  first  and  most  effective  step  in  combating  the 
decrease  of  production,  the  rise  of  prices,  and  the  fall  of  exchanges.  If 
they  will  not  or  can  not  adopt  such  a  course,  they  are  headed  for  insolvency 
and  social  and  economic  disruption. 

When  central  bank  rates  are  thus  once  more  effective  and  the  foreign 
credit  of  a  country  has  been  restored,  the  moment  will  be  at  hand  when  the 
resumption  of  gold  payments  may  be  considered,  and  with  that  the  stabili- 
zation of  foreign  exchanges.  Whenever  that  point  is  reached,  a  country 
may  be  deemed  to  have  completed  its  economic  convalescence.  The  first 
step  in  this  direction  must  be  the  establishment  of  honestly  balanced 
budgets. 

Side  by  side,  however,  with  the  determination  of  the  Government  to  stop 
the  further  increase  of  Government  debt  must  go  an  equally  firm  policy  on 
the  part  of  the  note-issuing  banks  to  arrest  a  further  expansion  of  cir- 
culation. 

Through  the  depreciation  of  the  purchasing  power  of  money  the  value 
of  the  return  from  investments  (that  is,  from  savings  of  the  past)  has 
been  cut  in  two  in  countries  with  the  soundest  economic  conditions,  and 
in  those  most  adversely  affected  it  has  been  decimated,  if  not  practically 
wiped  out.  The  distribution  of  income  in  all  countries  has  therefore  been 
drastically  modified.  In  the  aggregate,  the  share  of  the  farmer  and  the 
wage-earner  has ,  been  phenomenally  increased  at  the  expense  of  those 
who  lived  on  fixed  income  from  savings  of  the  past.  Extravagance  must 
not  only  be  curbed  on  top.  but  just  as  much  on  the  part  of  the  masses 
receiving  the  bulk  of  the  national  income,  and,  in  the  aggregate,  doing 
the  largest  share  of  the  country's  spending. 

For  the  vast  number  of  American  consumers,  a  recession  of  prices  is 
of  infinitely  greater  importance  than  boosted  exports  sold  at  high  prices 
to  purchasers  whose  natural  limit  of  credit  has  been  fairly  exhausted. 

For  foreign  countries  buying  our  goods,  a  decline  in  our  prices  would 
mean  either  a  corresponding  drop  in  their  own  prices  or  a  recovery  in  their 
exchanges,  or  a  combination  of  both.  In  any  case,  we  would  serve  them 
better  if  we  sold  them  at  a  lower  price  the  minimum  that  they  must  have 
than  if  we  furnished  tlieiu  on  credit,  and  at  high  prices,  the  maximum 
they  might  take. 

After  five  years  of  suffering  and  sacrifices,  the  masses  at  present  are 
unruly,  self-willed,  and  unreasonable.  They  are  unwilling  to  submit  to 
irksome  Government  interference  or  drastic  burdens  of  taxation.  The 
lending  countries,  by  insisting  on  the  adoption  of  a  balanced  budget  policy 
on  the  pan  of  borrowing  countries  asking  for  new  loans.,  and  by  reducing 
such  credits  to  ilie  very  minimum  necessary,  would  a<^ist  their  debtors  to 
choose  a  safe  course,  v/hich.  without  such  outside  iutluence.  their  Govern- 
ments miirlit  not  ahvays  be  able  to  follow. 


GENERAL   SESSIONS.  49 

Except  where  plainly  altruistic  motives  must  thus  exercise  a  determining 
influence,  I  believe  that  the  time  is  near  at  hand  when  international  bank- 
ers, considering  new  loans,  will  apply  the  strictest  principles  not  only  with 
respect  to  budgeting,  but  also  with  regard  to  the  urgency  of  applications 
and  the  purposes  involved.  As  it  will  be  every  citizen's  patriotic  duty  to 
accumulate  savings,  so  the  aggregate  gathered  for  investment  will  have 
to  be  looked  upon  as  a  sacred  fund  belonging  to  the  Nation,  to  be  employed 
only  where  it  will  do  the  greatest  possible  good.  World  demands,  in  the 
near  future,  will  far  out-distance  world  savings  and — if  it  were  possibl& — 
nothing  would  be  more  timely  than  a  "  world  priority  list,"  regulating  the 
use  of  new  capital.  These  views,  I  fear,  do  not  sound  very  encouraging 
to  countries  of  our  hemisphere  whose  future  largely  depends  upon  new 
development.  Happily,  however,  several  of  them  are  in  the  class  of  lend- 
ing rather  than  borrowing  countries,  and  quite  a  number,  through  the 
emergencies  of  the  war,  have  been  taught  to  develop  their  resources  and 
new  industries  and  have  made  admirable  progress  in  the  direction  of 
greater  economic  and  financial  independence. 

My  own  belief  is  that  capital  in  the  old  world  will  find  so  vast  a  field 
in  work  of  reconstruction  and  colonization  in  "  darkest  Europe "  that  it 
will  not  be  able  to  devote  itself  as  liberally  to  the  development  of  the 
countries  of  tlrs  hemisphere  as  it  did  in  the  past.  The  three  Americas  will, 
therefore,  be  drawn  together  in  a  commercial  and  financial  union  of  grow- 
ing strength  and  intimacy. 

The  next  formal  address  was  delivered  by  the  Hon.  Medill  Mc- 
Cormick,  a  Member  of  the  United  States  Senate,  who  prefaced  his 
address,  as  Mr.  Warburg  had  concluded  his,  with  words  of  welcome 
in  Spanish  to  the  delegates  from  the  other  countries.  Senator  Mc- 
Cormick  was  concerned  primarily  with  the  budget  system,  into  the 
need  of  which  he  went  in  great  detail. 

He  traced  the  system  of  the  movement  for  budgetary  legislation 
in  the  United  States  down  to  the  time  when  it  has  assumed  national 
proportions,  transcending  partisan  lines.  He  outlined  briefly  the 
plans  for  budgetary  reform  in  tlie  United  States,  then  under  consid- 
eration in  Congress,  indicating  in  an  illuminating  manner  the  grave 
defects  from  which  the  fiscal  system  of  the  United  States  suffers  be- 
cause of  its  failure  to  devise  a  budgetary  procedure.  He  discussed 
as  well  the  subject  of  audit  control  and  cited  the  practice  in  some  of 
the  other  American  countries. 

Senator  McCormick  was  followed  by  Dr.  Virgilio  Rodriguez 
Beteta,  of  the  delegation  of  Guatemala,  who  eloquently  set  forth  how 
profound  was  the  feeling  of  friendship  on  the  part  of  the  other 
countries  toward  the  United  States  because  of  the  sympathy  of  the 
people  and  Government  of  the  latter  country  toward  the  other  na- 
tions in  their  struggle  for  independence  and  national  development. 
Dr.  Rodriguez  Beteta  indicated  that  Guatemala  was  planning  the 
establishment  of  a  bank  of  issue  upon  a  sound  basis,  such  as  might 
be  calculated  to  stabilize  conditions  of  exchange  and  to  pave  the  way 
for  the  foundation  of  a  national  agricultural  mortgage  bank.  Thus 
14970—21 4 


50  SECOND  PAN   AMERICAN    FINANCIAL   CONFERENCE. 

Guatemala  would  be  in  a  position  to  take  care  of  her  indebtedness, 
to  establish  her  currency  on  a  sound  basis,  and  to  promote  vigorously 
the  development  of  her  natural  resources.  . 

A  detailed  survey  of  the  problem  of  national  credit  was  made 
by  Dr.  Florencio  Aragon  y  Etchart,  a  senator  of  Uruguay.  Dr. 
Arjigon  y  Etchart  took  as  his  text  a  statement  of  Mr.  Warburg's,  to 
the  effect  that  the  budgetary  law  of  a  country  is  one  of  the  most  pre- 
cise indications  of  the  financial  policy  which  it  follows.  He  quoted 
the  eminent  Argentine  economist,  Terry,  to  the  effect  that  in  ord4r 
to  know  well  the  financial  life  of  a  nation,  one  has  only  to  study  the 
pages  of  its  budget.  "  The  taxation  system  existing  in  some  of  the 
countries  of  South  America  is  certainly  not  one  based  on  scientific 
principles  of  economics,  nor  one  justly  conceived  with  respect  to  its 
incidence  on  the  taxpayer.  It  is  a  procedure  formed  in  the  inade- 
quate mold  of  the  old-time  systems  of  taxation,  resting  chiefly  upon 
customs  duties  and  analogous  taxation,  constituting  the  principal 
part  of  the  national  revenue.  This  type  of  taxation  offers  no  resist- 
ance to  the  slightest  domestic  commotion  or  to  the  effects  of  an  inter- 
national crisis  or  conflicts  of  other  countries.  When  such  an  event 
occurs  the  nations  of  South  America  which  enjoy  the  best  of  credit 
find  it  difficult  to  resist  this  convulsion  and  settle  the  difficulties 
ensuing  upon  financial  disturbance  in  the  world.  Customs  revenues 
shrink  the  moment  difficulties  arise  in  any  part  of  the  world,  con- 
sumption is  reduced,  and  a  period  of  retrenchment  in  expenditures 
sets  in."  Senator  Aragon  then  entered  upon  a  careful  analysis  of  the 
means  of  reforming  the  taxation  systems  of  the  Republics  of  America. 
In  speaking  of  the  difficulties  of  securing  funds  to  meet  the  frequently 
recurring  deficits,  he  pointed  out  that  customs  duties  had  already 
reached  a  maximum  in  most  of  the  American  Republics,  while  re- 
course to  money  lenders,  whether  domestic  or  foreign,  was  bound  to 
lead  to  a  discouraging  situation. 

"  The  pessimism  with  which  the  bankers  examine  the  resources  of 
the  country  usually  leads  them  to  be  more  exacting  in  their  condi- 
tions. If  they  grant  loans  it  is  upon  conditions  almost  usurious  in 
character  and  incompatible  with  the  given  credit  of  the  country — 
often  an  interest  of  8  or  9  per  cent  on  securities  sold  to  syndicates  at 
79  or  80.  The  reform  of  the  system  of  taxation  on  a  more  equitable 
basis  is  precisely  the  end  toward  which  the  countries  of  America 
should  strive,  if  they  wish,  and,  of  course,  there  is  no  possibility  of 
doubting  that  they  wish,  to  reinforce  their  economic  capactiy  and 
strengthen  their  financial  activity."  To  the  income  tax,  Senator 
Aragon  devoted  much  attention,  stating  that  it  is  an  equitable  means 
of  relieving  those  of  modest  resources  from  the  burden  of  many 
onerous  indirect  taxes,  while  it  furnishes  the  Government  with  a 
ready  measure  of  the  economic  progress  of  the  country.  He  showed 


GENERAL   SESSIONS.  51 

his  intimate  acquaintance  with  the  history  of  taxation  in  the  United 
States,  and,  in  closing,  dwelt  briefly  upon  the  importance  of  mone- 
tary reform  as  an  element  in  strengthening  national  credit.  The 
ideal  to  be  maintained  at  all  costs  for  the  strengthening  of  public 
credit  is  the  establishment  of  the  gold  standard,  not  merely  in  name 
but  in  fact,  having  by  its  side  the  bank  note,  convertible  on  demand, 
and  resting  squarely  on  public  confidence.  The  bank  of  the  Republic 
of  Uruguay  has  a  circulation  of  55,000,000  pesos,  resting  on  a  gold 
reserve  of  75  per  cent,  which  has  at  times  even  approximated  83  per 
cent.  The  notes  of  this  bank  circulate  in  Uruguay  like  gold  itself. 
The  session  adjourned  at  5.30  p.  m. 

FIFTH   GENERAL   SESSION,  FRIDAY,   JANUARY    23,    1920. 

The  conference  assembled  at  11  o'clock,  with  Gen.  Juan  E.  Paredes, 
chairman  of  the  delegation  of  Honduras,  in  the  chair.  Upon  the 
conclusion  of  the  routine  business  of  the  morning  session,  necessarily 
extensive  because  of  the  fact  that  this  was  the  last  session  of  the 
conference,  the  formal  address  on  the  "  Problems  of  the  UnitedStates 
as  a  Creditor  Nation,"  was  delivered  by  the  Hon.  W.  G.  P.  Harding, 
governor  of  the  Federal  Reserve  Board. 

We  in  the  United  States,  while  accustomed  to  maintain  a  favorable  trade 
balance  through  a  moderate  excess  of  exports  over  imports,  had  come  to 
look  upon  European  capital  as  a  natural  and  necessary  factor  in  our  de- 
velopment and  to  accept  with  complacency  the  fact  that  we  \vere  a  debtor 
and  not  a  creditor  nation.  Being  absorbed  primarily  in  our  own  affairs, 
we  were  satisfied  with  a  minor  position  in  financing  the  commerce  of  the 
world.  While  we  had,  of  course,  extensive  trade  relations  with  all  civil- 
ized countries,  we  undertook  to  finance  only  a  comparatively  small  part 
of  our  exporting  and  importing  transactions,  leaving  the  greater  part  of 
it  to  European  bankers  and  acceptance  houses.  Consequently,  most  of 
our  trade  with  our  sister  republics  to  the  south  was  financed  by  means 
of  credits  opened  in  London  and  other  Old  World  centers.  Our  participa- 
tion in  foreign  financing  was  confined  principally  to  dealings  in  short 
bills,  and  our  fixed  investments,  represented  by  holdings  in  securities  of 
foreign  Governments  and  municipalities  and  by  stocks  and  bonds  of  for- 
eign industries,  were  comparatively  small ;  in  fact,  we  had  become  so  de- 
pendent upon  foreign  capital  that  up  to  a  few  years  ago  it  was  the  cus- 
tom to  finance  our  growing  crops  by  means  of  finance  bills  drawn  in  antici- 
pation of  seasonal  exports  of  agricultural  stapled  in  the  fall  of  the  year. 

The  financial  dependence  upon  Europe  which  existed  in  the  United  States 
obtained,  perhaps,  in  a  greater  proportionate  degree  in  South  American 
countries,  and  for  this  reason  the  outbreak  of  the  World  War  in  August, 
1914,  caused  a  jar  which  shook  the  American  Continents  from  Alaska  to 
Tierra  del  Fuego. 

Five  years  ago  the  United  States  stood  as  a  debtor  on  the  world's  balance 
sheet  to  the  extent  of,  perhaps,  five  billions  of  dollars,  part  of  which  was 
represented  by  loans  of  short  maturities  and  the  greater  part  by  American 
securities  held  abroad.  *  *  * 


52  SECOND   PAX   AMERICAN   FINANCIAL,   CONFERENCE. 

Early  in  the  year  1917  it  became  evident  that  the  United  States  was  no 
longer  a  debtor  nation  but  was  a  creditor  nation  to  the  extent  of,  perhaps, 
two  billions  of  dollars.  *  *  * 

Because  of  the  great  demand  upon  capital  in  this  country,  we  must  not 
lose  sight  of  the  necessity  for  restricting  our  foreign  credits  to  essential 
purposes.  It  is  not  to  be  expected,  for  the  present  at  least  that  loans 
and  investments  abroad  will  be  made  because  of  attractive  rates  of  in- 
terest or  favorable  prospects  for  profit;  they  will  be  made,  primarily,  in 
the  hope  of  restoring  more  normal  conditions  in  the  war-stricken  coun- 
tries by  enabling  their  populations  to  get  back  to  productive  work,  and 
with  the  incentive  also  of  opening  foreign  markets  for  those  commodities 
of  which  we  produce  an  exportable  surplus. 

It  is  expected  that  corporations  organized  under  the  Edge  Act  will  make 
loans  to  business  men  in  Europe,  and  take  their  obligations  in  the  usual 
form.  It  may  be  that  they  will  require  the  guarantee  of  European  Govern- 
ments and  of  municipalities  and  that  the  beneficiaries  on  the  other  side 
will  be  required  to  provide  a  fair  cash  margin. 

The  loans  abroad  should  be  made  on  terms  sufficiently  long  as  to  enable 
repayment  to  be  made  out  of  credits  growing  out  of  European  exports. 
Because  of  adverse  exchange  rates  finance  bills  maturing  before  the  pro- 
ductive capacity  of  European  countries  has  been  restored  can  not  be  effec- 
tive. A  12  months'  credit  to  a  French  merchant  calling  for  repayment  at 
maturity  in  dollars  would  involve  heavy  loss  to  the  borrower  unless  he 
were  able  to  provide  himself  with  funds  in  this  country  by  means  of  the 
export  to  America  or  elsewhere  of  some  commodity  produced  in  France.  It 
is  evident,  therefore,  that  credits  must  be  sufficiently  long  to  enable  bor- 
rowers to  repay  them  out  of  the  proceeds  of  goods  produced  in  and  exported 
from  the  borrowing  country.  *  *  *  European  nationals  can  produce 
many  things  which  we  either  do  not  produce  at  all  or  can  not  produce  as 
cheaply  as  they  can,  or  it  may  be  that  they  can  produce  things  needed  in 
South  American  countries  or  in  the  Far  East,  and  as  American  importers 
have  constant  dealings  with  South  American  and  oriental  countries  it 
follows  that  European  credits  available  in  China  and  Japan,  Argentina, 
Chile,  Brazil,  and  other  Latin  American  nations  will  be  just  as  effective 
in  liquidating  European  obligations  in  the  United  States  as  direct  European 
credits  in  New  York  would  be. 

Governor  Harding  was  followed  by  a  member  of  the  delegation 
of  Mexico,  Dr.  Enrique  Martinez  Sobral,  who  briefly  reviewed  the 
rapidity  with  which  his. country  was  recovering  from  the  unfortu- 
nate consequences  of  civil  war,  and  demonstrating  its  ability  to  avail 
itself  successfully  of  its  very  great  natural  resources  and  prosperity. 

Dr.  Luis  Tejada,  head  of  the  delegation  of  Bolivia,  member  of  the 
congress  and  former  minister  of  finance,  of  that  country,  next  ad- 
dressed the  conference,  speaking  in  English  as  had  Dr.  Martinez 
Sobral.  He  outlined  to  the  congress  a  plan  for  the  extension  of 
financial  aid  to  Europe  by  the  United  States  through  the  purchase 
by  the  latter  country  of  Government  securities  of  the  Republics  of 
Central  and  South  America  now  held  in  Europe.  Both  halves  of 
the  hemisphere  were  in  accord  as  to  the  need  of  aiding  Europe,  in- 
asmuch as  the  problems  of  the  world  called  for  the  reconstruction  of 


GENERAL   SESSIONS.  53 

Europe  as  a  prerequisite  to  their  own  solution.  Direct  loans  from 
the  countries  of  this  hemisphere  to  the  countries  of  the  older  world 
wTere  difficult,  and  the  problem  was  constantly  becoming  more  com- 
plicated by  the  decline  in  exchange.  "If  the  United  States  decides  to 
grant  assistance  to  Europe,  let  it  do  so  by  allowing  Latin  America 
to  pay  its  obligations  to  the  countries  of  Europe.  This  would  allow 
Latin  America  to  take  advantage  of  exchange  conditions,  while  it 
would  do  no  harm  to  Europe,  inasmuch  as  the  exchange  situation 
must  be  adjusted  before  her  reconstruction  can  begin.  No  advantage 
would  accrue  to  Europe  from  her  retention  of  Latin  American  obli- 
gations, *  *  *  while  on  the  other  hand  a  market  would  be  created 
for  European  securities,  inasmuch  as  the  countries  of  Central  and 
South  America  when  discharging  their  own  obligations  would  pur- 
chase those  of  Europe." 

The  fourth  address  of  the  morning  was  delivered  by  Dr.  Carlos 
Cesar  de  Oliveira  Sampaio,  chairman  of  the  Brazilian  delegation. 
Dr.  Sampaio  discussed  the  problems  of  Brazil  as  a  debtor  nation. 
After  outlining  the  effect  of  the  war  on  Brazil,  he  emphasized  his 
belief  that  the  other  portions  of  this  hemisphere  must  necessarily 
remain  the  chief  field  for  the  display  of  enterprise  from  the  United 
States.  "  The  program  of  the  Brazilian  Government  is  to  reduce 
public  expense,  improve  the  fiscal  system,  bring  about  a  balance  of 
its  budget,  contract  loans  only  for  productive  purposes,  reorganize 
the  banking  system  of  the  country*  so  as  to  make  its  currency  more 
elastic,  and  abandon  forever  the  process  of  issuing  inconvertible  cur- 
rency. We  expect  gradually  to  establish  a  safe  basis  for  our  mone- 
tary system  and  for  the  improvement  of  our  national  finances.  We 
hope  to  increase  production  and  reduce  imports,  to  stabilize  exchange, 
to  pay  the  interest  on  our  loans,  and  to  fill  the  gaps  left  by  recurring 
deficits.  The  prosperity  of  a  nation  is  related  to  its  capacity  for 
production,  which  depends  upon  land,  labor,  and  capital.  Land  we 
have  in  abundance.  Two-thirds  of  our  territory  we  have  not  yet 
explored,  having  yet  to  follow  the  example  of  the  great  American 
who  discovered  the  Roosevelt  River  in  northern  Brazil.  Of  capital 
we  have  not  enough  and  we  are  obliged  to  look  to  other  countries. 
We  have  not  sufficient  man  power,  but  men  will  come  to  us,  if  for 
no  other  purpose  than  to  escape  from  the  troubled  situation  in 
Europe.  What  we  wish  to  see  now  is  a  greater  number  of  citizens 
of  the  United  States  at  work  in  Brazil  with  their  own  money,  just 
as  the  Chicago  packers  are  developing  our  meat  industries  and  the 
smelting  interests  are  trying  to  bring  about  the  same  result  with 
iron  ore  and  manganese."  Dr.  Sampaio  referred  to  the  blow  to  the 
rubber  industry  of  Brazil  through  the  creation  of  new  sources  of 
that  commodity  in  other  parts  of  the  world,  and  expressed  the  hope 
that  the  rubber  industry  would  again  be  prosperous  in  his  country. 


54  SECOND   PAN    AMERICAN    FINANCIAL   CONFERENCE. 

At  the  conclusion  of  the  remarks  of  Dr.  Sampaio,  the  Hon.  John 
Bassett  Moore,  chairman  of  the  committee  on  resolutions,  submitted 
the  report  of  his  committee.1  The  chairman  of  the  committee  read 
the  report  in  full,  briefly  commenting  on  those  of  the  resolutions 
which  called  for  any  explanation.  The  voting  on  the  resolutions  of 
the  conference  then  took  place,  there  being  unanimous  approval  of 
the  resolutions  as  submitted  by  the  committee,  but  three  countries 
making  reservation  to  certain  resolutions.2 

The  secretary  general  then  submitted  his  own  formal  report.3 

His  Excellency,  the  minister  of  finance  of  Argentina,  Dr.  Domingo 
E.  Salaberry,  on  behalf  of  the  official  delegations  and  venturing  to 
interpret  their  feeling,  expressed  the  deep  gratitude  for  the  hospi- 
tality and  consideration  shown  to  them,  and  called  upon  the  assembly 
to  rise  as  an  expression  of  its  consideration  for  the  President  of  the 
United  States,  for  whose  speedy  restoration  to  good  health,  he  stated, 
he  was  confident  all  the  delegates  sincerely  hoped. 

Unanimous  votes  of  thanks  to  the  Secretary  of  the  Treasury  and  to 
the  secretary  of  the  conference  were  adopted. 

The  Secretary  of  the  Treasury  then  took  the  chair,  and,  expressing 
his  deep  regret  that  because  of  illness  and  the  pressure  of  official 
duties,  he  had  been  deprived  of  the  pleasure  of  constant  contact  with 
the  delegates  and  members  of  the  committees,  he  stated  that  he  felt 
entire  confidence  that  the  conference  could  not  but  cement  the  bonds 
of  cooperation  between  the  American  Republics,  and  stimulate  the 
desire  of  all  their  citizens  to  unite  in  the  great  purpose  of  being  of 
service  to  each  other,  to  humanity,  and  to  the  world.  He  then  de- 
clared the  sessions  of  the  conference  adjourned  sine  die  at  1  p.  m. 

On  the  evening  of  Saturday,  January  24,  a  banquet  was  tendered 
by  the  Secretary  of  the  Treasury  to  the  delegates  in  the  Hall  of  the 
Americas  of  the  Pan  American  Building,  and  was  attended  by  the 
official  delegates  and  the  members  of  the  committees. 

In  the  course  of  this  banquet,  the  replies  of  the  Presidents  of  the 
American  Republics  to  the  telegram  of  the  President  of  the  United 
States  were  read  by  the  secretary  general. 

A  rising  vote  of  thanks  was  extended  to  the  governing  board  of 
the  Pan  American  Union  for  its  courtesy  and  kindness  in  putting  at 
the  disposal  of  the  conference  the  halls  of  the  building.  Toasts  were 
proposed  and  drunk  to  the  Presidents  of  the  American  Republics, 
and  felicitous  remarks  were  made  on  behalf  of  the  official  delegations 
by  His  Excellency,  the  minister  of  finance  of  Argentina,  and  His 
Excellency,  the  Mexican  ambassador,  and  on  behalf  of  the  United 

1  This  will  be  found  in.  full  on  p.  56. 

2  These  reservations  will  be  found  following  the  resolutions  on  p.   15. 

3  This  report  will  be  found  on  p.  12. 


GENERAL   SESSIONS.  55 

-States  by  the  Hon.  Thomas  R.  Marshall,  Vice  President  of  the  United 
States. 

TRIP  TO  PHILADELPHIA   AND   NEW  YORK  OF  THE   OFFICIAL  DELEGATES  TO 
THE  SECOND  PAN  AMERICAN  FINANCIAL  CONFERENCE. 

On  Sunday,  January  25,  1920,  a  number  of  the  offcial  delegates  to 
the  conference,  accompanied  by  their  families  and  attended  by  some 
members  of  the  staff  of  the  conference,  proceeded  to  Philadelphia, 
where  they  were  received  at  the  station  by  a  committee  representing 
the  mayor  of  the  city  and  the  chamber  of  commerce.  A  dinner  was 
tendered  to  them  by  the  Baldwin  Locomotive  Co.  at  the  hotel  in 
which  they  were  lodged  as  guests  of  the  Treasury  Department,  and  the 
following  day  a  portion  of  the  party  went  to  inspect  the  Baldwin 
Locomotive  Works,  while  another  group  visited  the  New  York  Ship 
Building  Corporation's  plant,  where  a  ship  was  launched  during  the 
visit.  Luncheons  were  tendered  at  both  establishments,  and  in  the 
evening  the  parties  returned  to  Philadelphia  and  preceded  to  New 
York. 

On  Tuesday,  January  27,  the  delegates  visited  the  Federal  Reserve 
Bank  of  New  York  and  were  shown  in  detail  the  system  employed  in 
its  operation.  At  the  termination  of  the  visit  thfe  delegates  were  the 
guests  at  luncheon  of  the  directors  and  officers  of  the  bank  at  the 
Bankers  Club.  Addresses  were  delivered  by  Acting  Governor  Case, 
Dr.  Tejada,  Messrs.  W.  L.  Saunders,  and  A.  B.  Hepburn. 

On  the  same  evening  a  banquet  wa's  given  in  honor  of  the  delegates 
by  the  Pan  American  Society  of  the  United  States  at  the  Waldorf 
Astoria  Hotel.  Addresses  were  delivered  by  the  Hon.  John  Bassett 
Moore,  president  of  the  society;  the  former  Secretary  of  the  Treas- 
ury, W.  G.  McAdoo ;  Dr.  Ricardo  Aldao,  Dr.  J.  G.  Schurman,  and 
Dr.  L.  S.  Rowe. 


REPORT  OF  THE  COMMITTEE  ON  RESOLUTIONS. 

The  honorable  the   SECRETARY  OF  THE  TREASURY  OF  THE  UNITED 

STATES. 

SIR  :  The  committee  on  resolutions  designated  a  special  subcommit- 
tee, composed  of  John  Bassett  Moore,  Eusebio  Ayala,  Luis  Izquierdo, 
Luis  Toledo  Herrarte,  John  H.  Fahey,  Frank  A.  Vanderlip,  and  Paul 
M.  Warburg,  to  confer  and  consider  every  proposal  laid  before  the 
committee,  either  formally  or  informally,  and  to  draft  resolutions 
and  report  them  to  the  committee.  This  subcommittee  examined 
carefully  all  the  conference  reports,  including  the  report  of  the  com- 
mittee on  transportation,  and  also  various  proposals  directly  laid  be- 
fore it,  and  then  formulated  resolutions  which  were  duly  laid  before 
the  committee.  The  latter  acted  upon  the  recommendations  of  the 
subcommittee  and  submitted  to  the  conference  for  adoption  the  fol- 
lowing resolutions,  in  which  the  members  of  the  committee  unani- 
mously concurred : 

I.  Resolved,  That,  with  a  view  more  definitely  to  indicate 
the  constituency  and  sphere  of  work  of  the  International  High 
Commission,  the  title  of  that  body  shall  hereafter  be  "The 
Inter- American  High  Commission." 

II.  Resolved,  That  the  conference  adopts  that  part  of  the 
report  of  the  committee  on  transportation  and  communication 
relating  to  maritime  transportation,  and  directs  its  transmis- 
sion to  the  United  States  Shipping  Board  for  consideration  and 
action;  and  that  so  far  as  concerns  the  subjects  of  railroad 
transportation,  postal  facilities,  uniformity  of  bills  of  lading,, 
and  wireless,  cable,  and  telegraph  communication  the  report  be 
transmitted  to  the  Inter- American  High  Commission  for  suitable 
action. 

III.  Whereas  banks,  both  National  and  State,  in  the  United 
States  have   established  branches   in   various   Latin-American 
countries;  and 

Whereas  restrictions  exist  under  the  laws  of  various  States 
of  the  United  States  which,  in  effect,  prevent  the  operation  of 
branches  of  foreign  banks  within  their  jurisdiction : 

Therefore  we  recommend  that  the  legislation  in  such  States 
be  so  modified  as  to  permit  the  establishment  of  branches  of 
banks  of  Latin- American  countries,  under  proper  regulations,, 
so  as  to  secure  equality  of  treatment. 

56 


REPORT   OF    COMMITTEE   ON   RESOLUTIONS.  57 

IV.  Resolved,  That  the  Inter-American  High  Commission  be 
requested  to  study  the  question  of  the  possibility  of  achieving 
uniformity  and  relative  equality  in  the  laws  and  regulations 
governing  the  organization  of  corporations  and  the  treatment 
of  foreign  corporations  in  the  various  American  Republics. 

V.  Resolved,  That  the  conference  recommends  the  increased 
use  of  acceptances  for  the  purpose  of  financial  transactions  in- 
volving the  importation  and  exportation  of  goods,  and  hopes 
that,  with  the  passing  of  the  period  of  readjustment  in  which 
nations   are   now   engaged,  the  United   States   will  offer  con- 
stantly widening  market  for  the  long-term  securities  of  Amer- 
ican countries. 

VI.  Resolved,  That  the  Inter- American  High  Commission  be 
requested  to  continue  its  efforts  to  bring  about  the  adoption  of 
the  plan,  recommended  at  Buenos  Aires  in  1916,  for  the  estab- 
lishment of  an  international  gold  fund,  such  plan  having  already 
been  embodied  in   a  convention  which   has  been  adopted  by 
several  of  the  American  Republics. 

VII.  Resolved,  That,  steps  having  heretofore  been  taken  to 
bring  about  the  adoption  by  the  American  countries  of  a  uni- 
form law  in  regard  to  bills  of  exchange,  the  conference  requests 
the  Inter- American  High  Commission  to  bring  to  the  notice 
of  the  American  Governments  the  desirability  of  adopting  a 
uniform  law  on  the  subject  of  checks. 

VIII.  Resolved,  That,  in  view  of  the  increase  and  diversifica- 
tion of  taxes  in  the  various  American  countries,  the   Inter- 
American  High  Commission  be  asked  to  study  the  question  of 
the  best  method  of  avoiding  the  simultaneous  double  taxation 
of  individuals  and  corporations  as  between  such  countries. 

IX.  Whereas  the  international  bureau,  at  Habana,  for  the 
registration   of   trade-marks,    as   provided   in   the    convention 
adopted  by  the  Fourth  International  American  Conference  at 
Buenos  Aires  in  1910,  has  been  opened  and  is  in  successful  oper- 
ation : 

Resolved,  That  the  conference  recommends  the  early  ratifica- 
tion of  that  convention  by  all  the  American  countries  that  have 
not  so  far  ratified  it,  to  the  end  that  its  provisions  may  be  effec- 
tive throughout  the  Americas. 

Meanwhile,  it  is  suggested  that,  pending  the  establishment  of 
the  international  bureau  at  Rio  de  Janeiro,  consideration  be 
given  to  the  use  of  the  Habana  bureau  by  countries  of  the  south- 
ern group  that  have  ratified  the  convention. 

X.  Resolved,  That  the  conference  recommends  the  early  rati- 
fication by  the  American  Republics,  so  far  as  they  have  not 
already  ratified  it,  of  the  convention  adopted  by  the  Interna- 


58  SECOND   PAX   AMERICAN   FINANCIAL   CONFERENCE. 

tional  American  Conference,  at  Buenos  Aires,  in  1910,  concerning 
patents  and  copyrights. 

XI.  Resolved,  That  the  conference  recommends  that  the  Webb 
law  be  so  amended  as  to  permit  American  companies,  importing 
or  dealing  in  raw  materials  produced  abroad,  to  form,  under 
proper  governmental  regulations,  organizations  to  enable  such 
companies  to  compete  on  terms  of  equality  with  companies  of 
other  countries  associated  for  the  conduct  of  such  business. 

XII.  Resolved,  That  the  conference  recognizes  the  value  of  the 
services  of  commercial  attaches,  and  strongly  urges  a  substantial 
extension  of  the  system. 

In  making  this  recommendation  the  conference  intends  to  ex- 
press its  sense  of  the  importance  of  appropriate  training,  lin- 
guistic and  otherwise,  for  all  branches  of  the  foreign  service,  as 
a  means  of  developing  and  facilitating  commercial  and  financial 
relations. 

XIII.  Resolved,  That  a  simultaneous  census  should  be  taken 
in  all  the  American  countries  at  regular  intervals,  not  exceeding 
10  years,  in  harmony  with  the  system  prevailing  in  the  United 
States,  and  that  uniformity  should  be  observed  in  the  prepara- 
tion of  statistical  works. 

XIV.  Resolved,  That  the  conference   recommends  that  the 
metric  system  of  weights  and  measures  be  universally  employed, 
and  that,  pending  the  attainment  of  that  end,  articles  weighed 
and  marked,  and  shipping  documents,  prepared  according  to  the 
system  of  weights  and  measures  now  prevailing  in  the  United 
States,  should  be  accompanied  with  statements  giving  the  equiva- 
lents under  the  metric  system. 

XV.  Resolved,  That  the  plan  of  arbitration  of  commercial 
disputes  put  into  effect  between  the  Bolsa  de  Comercio  of  Buenos 
Aires  and  the  United  States  Chamber  of  Commerce,  and  since 
adopted  by  the  chambers  of  commerce  of  several  other  American 
countries,  should  be  extended  to  all  the  American  countries,  and 
that  legislation  should  be  adopted  wherever  it  is  now  lacking  for 
the  purpose  of  incorporating  the  arbitral  settlement  of  commer- 
cial disputes  into  the  judicial  system,  to  be  carried  out  under 
the  supervision  of  the  courts. 

XVI.  Resolved,  That  the  Inter- American  High  Commission 
be  requested  to  study  the  question  of  the  creation  of  an  inter- 
American  tribunal  for  the  adjustment  of  questions  of  a  com- 
mercial or  financial  nature  involving  two   or  more  American 
countries  and  the  determination  of  such  questions  on  principles 
of  law  and  equity. 

XVII.  Resolved,  That  it  being  in  the  interest  of  all  nations 
that   there  should  be  the  widest  possible  distribution  of  raw 


REPORT   OF    COMMITTEE   ON   RESOLUTIONS.  59 

materials,  the  importation  of  such  materials  into  any  country 
should  not  be  prevented  by  prohibitive  duties. 

XVIII.  Resolved,  That  it  is  recommended  that  the  banking 
interests  of  the  United  States  study  the  possibility  of  financial 
relief  to  Europe  by  repaying  Latin- American  obligations  held 
in  Europe  by  means  of  new  loans  granted  in  the  United  States 
to  the  respective  Latin- American  countries. 

With  respect  to  some  of  the  foregoing  18  resolutions  a  few  explana- 
tory remarks  may  be  made. 

Resolution  No.  I  is  intended  to  change  the  title  of  "  The  Interna- 
tional High  Commission  "  to  "  The  Inter- American  High  Commis- 
sion." Your  committee  found  that  in  the  work  of  the  International 
High  Commission  much  difficulty  and  confusion  had  at  times  arisen 
from  the  fact  that  the  title  "International  High  Commission"  did 
not  convey  a  definite  indication  either  of  the  constituency  of  the  com- 
mission or  of  the  sphere  within  which  it  carried  on  its  activities. 
There  are  so  many  international  high  commissions,  chiefly  with 
European  countries,  that  a  clarification  seemed  to  be  desirable.  This 
resolution,  it  is  hoped,  will  accomplish  that  end. 
'  Resolution  No.  II  relates  to  the  report  of  the  committee  on  trans- 
portation. The  only  part  of  that  report  which  the  resolution  for- 
mally adopts  is  that  relating  to  maritime  transportation.  The  other 
subjects  were  so  varied  and  involved  so  much  detail  that  it  was 
thought  better  to  refer  them  to  the  Inter- American  High  Commission 
for  consideration  than  to  ask  the  conference,  within  the  time  at  its 
disposal,  to  undertake  to  follow  them  through  all  their  ramifications 
so  as  to  formulate  and  express  definite  conclusions. 

Resolution  No.  IV  relates  mainly  to  the  treatment  of  foreign  cor- 
porations and  their  branches.  This  is  obviously  a  question  of  prac- 
tical concern  to  all  the  American  countries. 

Resolution  No.  IX  relates  to  the  trade-mark  convention  adopted 
at  Buenos  Aires  in  1910.  That  convention  provided  for  the  division 
of  the  American  countries  into  two  groups — a  northern  and  a  south- 
ern— with  an  international  bureau  of  registration  for  each  group, 
the  northern  bureau  to  be  at  Habana  and  the  southern  at  Rio  de 
Janeiro ;  and  in  order  that  each  or  either  of  these  bureaus  should  be 
established  it  was  necessary  that  two-thirds  of  the  group  which  it 
was  to  serve  should  ratify  the  convention.  More  than  two-thirds  of 
the  northern  group  have  ratified  the  convention,  and  in  August, 
1919,  the  international  bureau  at  Habana  was  opened  and  is  now  in 
successful  operation.  The  resolution,  adverting  to  this  fact,  pur- 
poses that  the  conference  recommend  the  early  ratification  of  the 
convention  by  all  the  American  Republics  that  have  not  as  yet  rati- 
fied it,  so  that  its  provisions  may  be  effective  throughout  the  Amer- 
icas. Meanwhile,  the  resolution  suggests  that  the  countries  of  the 


60  SECOND   PAX    AMERICAN    FINANCIAL   CONFERENCE. 

southern  group  that  have  ratified  the  convention  may,  if  they  so 
desire,  gain  the  benefits  of  the  convention  by  using  the  Habana 
bureau,  to  which  it  is  understood  that  there  is  no  legal  or  other 
obstacle.  Indeed,  the  able  and  efficient  director  of  the  Habana 
bureau,  Dr.  Mario  Diaz  Irizar,  as  appears  by  his  report  of  December 
31,  1919,  now  in  the  hands  of  the  conference,  has  from  the  first  been 
sending  notifications  of  registration  to  countries  in  the  southern 
group  that  have  ratified  the  convention,  as  well  as  to  countries  in 
the  northern  group,  and  has  held  himself  ready  to  accept  any  appli- 
cations for  registration  that  might  be  sent  to  him  from  ratifying 
countries  of  the  southern  group. 

Washington,  D.  C.,  January  23,  1920. 

COMMITTEE  ON  RESOLUTIONS. 
JOHN  BASSETT  MOORE, 

Chairman, 

THEODORE  H.  THIESING,  Secretary. 


REPORT  OF  THE  COMMITTEE  ON  TRANSPORTATION  AND 
COMMUNICATIONS. 


The   honorable  the   SECRETARY  OF  THE  TREASURY  OF  THE  UNITED 
STATES. 

SIR:  Your  committee  on  transportation  and  communications  has 
judged  it  wise,  for  the  fuller  investigation  of  the  subject,  to  treat 
the  matter  of  transportation  and  communications  under  four  heads : 
Maritime  transportation;  railroad  transportation;  wireless,  cable, 
and  telegraph  communication;  postal  facilities,  documentation,  and 
maritime  insurance. 

.Recommendations  of  subcommittees  which  had  studied  these  four 
aspects  of  the  problem  were  adopted  unanimously  by  the  committee 
on  transportation  and  communications,  and  are  herewith  presented  as 
the  final  recommendations  of  your  committee. 

MARITIME  TRANSPORTATION. 


1.  A  substantial  reduction  of  freight  rates:  these  have  so  increased 
since  the  outbreak  of  the  war  that  they  are  hampering  commercial 
intercourse   between   the  United   States   and   the   Latin   American 
Republics. 

2.  The  establishment  of  regular  freight  lines,  the  vessels  of  such 
lines  to  be  as  large  as  is  economically  practicable,  considering  the  port 
depths,  the  loading  and  unloading  facilities,  and  the  kind  of  prod- 
ucts generally  shipped. 

3.  The  use  of  cargo  boats  designed  for  special  trades,  particularly 
for  the  movement  of  coal  and  bulk  cargoes. 

4.  The  conclusion  of  arrangements  between  the  oceanic  and  coast- 
wise shipping  interests  of  various  countries,  whereby  through  rates, 
including  transfer  service,  may  be  secured,  and  through  shipments 
may  be  made  from  the  larger  ports  to  smaller  ones  at  which  oceanic 
steamers  do  not  touch. 

5.  The  establishment  of  more  frequent  sailings  and  the  use  of 
faster  boats  in  the  passenger  service  between  the  JJnited  States  and 
Latin  American  countries.     It  is  desirable  that  this  type  of  service 
should  be  at  least  equal  in  speed  and  accomodations  to  that  existing 
between  the  countries  of  Latin  America  and  any  other  countries  of 
the  world. 

61 


62  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

6.  The  establishment  of  a  fast  weekly  passenger  service  between 
New  York  and  Buenos  Aires  by  way  of  Rio  cle  Janeiro  and  Monte- 
video.   If  vessels  having  the  necessary  draft,  speed,  and  other  requi- 
sites for  operation  in  such  a  service  are  not  now  available,  their  con- 
struction should  be  started  as  soon  as  possible. 

7.  The  establishment  and  operation  of  a  provisional  fortnightly 
passenger  service  between  New  York  and  Buenos  Aires  by  way  of 
Rio  de  Janeiro  and  Montevideo.    In  this  service  there  should  be  used 
steamers  now  available  which  are  capable  of  maintaining  an  average- 
of  not  less  than  18  knots  per  hour. 

8.  The  establishment  of  a  line  connecting  the  west  and  east  coasts 
of  South  America.    If  private  enterprise  is  not  able  to  take  care  of 
this  project  properly,  the  amount  of  aid  which  could  be  given  ix> 
such  a  line  by  the  various  American  Governments  should  be  ascer- 
tained in  the  manner  suggested  by  the  Chilean  delegation. 

9.  The  adoption  of  a  policy  whereby  mail  contracts  should  con- 
cede more  suitable  remuneration  for  fast  service,  thereby  aiding  in 
the  improvement  of  passenger  service  to  the  various  countries  con- 
cerned. 

10.  The  reduction  of  port  dues  and  handling  charges  in  Latin 
American  countries,  and  the  simplification  and  standardization  of 
port  regulations. 

11.  In  view  of  the  importance  of  improving  transportation  facili- 
ties and  of  securing  continuous  and  concerted  action  in  that  direc- 
tion, the  International  High  Commission  should  appoint  a  perma- 
nent committee  to  aid  in  the  execution  of  the  recommendations 
herein  made,  and  in  general  to  investigate  and  study  the  problem  of 
ocean  transportation  for  the  purpose  of  making  recommendations 
to  the  various  Governments  for  improvement  of  the  service  and  for 
the  better  development  of  commercial  relations. 

RAILROAD  TRANSPORTATION. 

1.  That  a  conference  be  called  of  the  Government  officials 
heads  of  companies  operating  in  the  Latin  American  Republics  in 
the  near  future  for  the  purposes  of  preparing — 

(a)  A   comprehensive   plan   for  the  linking   of   small   lines 
into  through  trunk  systems,  whereby  duplication  of  service 
may  be  avoided. 

(b)  Plans  for  the  operation,  financing,  and  general  stand- 
ardization of  rates,  equipment,  and  practices  of  trunk-line 
railways. 

2.  That  consideration  be  given  to  the  establishment  of  branch 
roads  for  the  development  of  the  territory  served  by  the  trunk  lines. 


BEPOET  COMMITTEE  ON  TRANSPORTATION  AND  COMMUNICATIONS.     Q& 

3.  That  the  nations  of  the  South  and  Central  American  Republics 
do  their  utmost  to  develop  and  utilize  their  resources,  such  as  water 
and  petroleum,  in  order  to  have  power  to  move  their  trains ;  and  that 
new  transcontinental  lines  be  established  traversing  the  continent 
from  east  to  west. 

4.  That  as  part  of  the  internal  transportation  facilities  of  each  of 
the  countries  there  be  developed  a  system  of  highways  suitable  for 
motor  truck  use  and  other  vehicular  traffic,  giving  access  to  the  terri- 
tory that  can  not  be  economically  reached  by  steam  railroads.    Such 
roads  and  highways  will  enable  the  railroads  to  obtain  the  products 
of  the  interior  and  to  distribute  articles  of  commerce. 

POSTAL    FACILITIES. 

1.  That  the  delegates  from  all  Latin- American  Republics,  not  now 
parties  to  postal  conventions  whereby  mail  is  exchanged  between 
those  countries  and  the  United  States  under  the  rates,  conditions, 
and  classifications  applicable  to  the  domestic  service  of  each  country, 
urge  upon  their  respective  Governments  the  importance  of  entering 
into  such  conventions ;  and 

2.  That  the  delegates  to  the  Second  Pan  American  Financial  Con- 
ference be  requested  to  urge  upon  their  respective  Governments  the 
importance  of  parcel  post  conventions  providing  and  limiting  in- 
demnity for  nondelivery  of  parcel  post  shipments,  and  the  use  of 
the  utmost  diligence  in  reducing  thefts  of  such  shipments. 

UNIFORMITY  OF  BILLS  OF  LADING. 

1.  That  the  Second  Pan  American  Financial  Conference  request 
the  International  High  Commission  to  draft  or  to  cause  to  be  draf tedr 
with  due  regard  to  the  rights  and  liabilities  of  those  interested  in  the 
shipment  and  transportation  of  merchandise  in  the  overseas  trade  be- 
tween the  countries  represented  in  the  conference,  a  uniform  bill  of 
lading,  with  weight  units  expressed  in  both  the  avoirdupois  and  metric 
systems,  as  simple  in  form  and  as  limited  in  stipulations  and  condi- 
tions as  the  practical  necessities  of  the  overseas  service  will  admit; 
and 

2.  That  the  International  High  Commission  be  further  requested 
to  submit  the  draft  of  such  bill  of  lading  to  the  ministers  of  finance 
of  the  countries  represented  in  the  conference,  and  to  the  United 
States  Shipping  Board,  the  principal  ocean  carriers,  and  the  leading 
commercial  organizations  and  foreign  trade  bankers  of  the  United 
States  interested  in  overseas  trade,  with  a  request  for  their  consid- 
eration of,  and  conclusions  with  respect  to,  the  proposed  form ;  and 

3.  That  the  International  High  Commission  be  further  requested 
to  prepare  or  to  cause  to  be  prepared  a  final  draft  of  such  bill  of  lad- 
ing with  due  regard  to  the  criticisms  and  suggestions  which  shall  have 


64  SECOND  PAX   AMERICAN   FINANCIAL   CONFERENCE. 

been  made  by  those  to  whom  the  first  draft  shall  have  been  sub- 
mitted, and  to  furnish  copies  of  such  final  draft  to  the  ministers 
of  finance  of  the  countries  represented  in  the  conference,  and  to  the 
United  States  Shipping  Board,  the  principal  ocean  carriers,  and  the 
leading  commercial  organizations  and  foreign  trade  bankers  of  the 
United  States,  with  the  request  that  all  reasonable  efforts  be  exerted 
to  have  such  proposed  form  of  bill  of  lading  adopted  into  common 
use  in  the  overseas  trade  between  the  respective  countries ;  and 

4.  That  such  form  of  bill  of  lading  be  known  as  the  "  Pan  Amer- 
ican Conference  bill  of  lading." 

WIRELESS,  CABLE,  AND  TELEGRAPHIC  COMMUNICATION. 


1.  That  copies  of  the  statement  entitled  "Postal,  cable,  and  tele- 
graph communication  with  Latin  America  "  be  furnished  to  the  dele- 
gates of  the  several  nations  represented  at  the  conference ;  and 

2.  That  a  permanent  subcommittee  on  cables,  wireless,  and  tele- 
graphs be  appointed  by  the  conference,  in  view  of  the  importance  of 
the  subject  and  the  inadequacy  of  existing  facilities,  with  a  view  to 
cooperation  of  such  permanent  subcommittee  with  such  officials  of 
the  Latin- American  countries  as  may  be  designated  by  their  re- 
spective Governments,  this  subcommittee  to  function  under  the  gen- 
eral guidance  of  the  International  High  Commission. 

For  the  committee  on  transportation  and  communications, 

J.  W.  ALEXANDER, 

Chairman. 
J.  C.  CORLISS, 

Secretary. 


ARGENTINA. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  OF  THE  TREASURY  OF  THE   UNITED 

STATES. 
SIR  :  Your  committee  has  the  honor  to  render  the  following  report : 

I.    TRANSPORTATION. 

It  was  reported  that  five  steamers  have  been  selected  to  run  be- 
tween New  York,  Brazil,  Uruguay,  and  Argentina,  having  a  speed 
of  about  15  knots  and  a  displacement  of  from  14,000  to  18,000  tons. 
These  steamers  will  make  the  trip  to  Buenos  Aires  via  Rio  de  Janeiro 
and  Montevideo  in  about  18  days. 

The  representatives  of  Argentina  pointed  out  that  during  the  past 
30  years,  except  for  the  period  of  the  war,  faster  service  was  in  effect 
from  their  country  to  Italy,  France,  Germany,  and  Spain,  steamers 
making  the  trip  in  15  days.  They  desired,  in  order  properly  to 
develop  trade  between  the  United  States  and  Argentina,  that  a 
similar  service  from  this  country  be  established,  requesting  that 
steamers  of  about  18  knots  be  used.  The  representatives  of  Argen- 
tina also  pointed  out  the  need  of  increased  passenger  and  mail  serv- 
ice, their  greatest  difficulty  being  at  present  the  inadequate  number 
of  sailings  to  take  care  of  the  commercial  mails,  parcel  post,  and 
business  passengers  between  the  two  countries. 

It  was  the  consensus  of  opinion  that  a  recommendation  should  be 
made  to  the  Shipping  Board  to  have  placed  in  this  service  as  soon  as 
possible  two  or  more  steamers  of  greater  speed,  with  a  request  at  the 
same  time  that  payment  be  made  for  the  carriage  of  mail  and  parcel 
post  by  Argentina,  Uruguay,  Brazil,  and  the  United  States,  this  pay- 
ment not  to  be  considered  in  any  way  in  the  form  of  subsidy,  but 
simply  a  fair  compensation  for  service  rendered. 

Need  for  improved  docking  and  terminal  facilities  was  pointed  out 
by  the  American  group,  and  the  Argentine  delegation  gave  assurance 
that  improvements  were  now  already  under  way  and  would  be  pushed 
forward  as  rapidly  as  possible  so  as  practically  to  double  the  present 
facilities  in  the  very  near  future. 

14970—21 5  65 


66  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

The  following  resolution  was  adopted : 

Whereas  the  Americas  alone  are  at  once  capable  of  rapidly 
increasing  surplus  yields  of  those  products  of  mine,  forest,  and 
field  Avhich  the  world  must  have  in"  order  to  insure  safety  to 
civilization ;  and 

Whereas  only  through  the  perfection  of  a  transportation  sys- 
tem that  will  link  the  Americas  each  to  the  other  and  all  writh 
the  markets  of  Europe,  Asia,  and  Africa  will  rapid  development 
be  promoted :  Therefore  be  it 

Resolved,  That  we  suggest  to  the  Transportation  Committee 
that  it  recommend  that  the  Governments  of  the  several  American 
Republics  consider  the  advisability  of  entering  into  a  joint  agree- 
ment looking  to  the  fostering  and  developing  of  a  perfected  sys- 
tem of  passenger  and  freight  steamship  transportation  which 
will  link  the  several  countries  of  the  Americas  for  purposes  of 
interchange,  and  the  Americas  as  a  whole  with  the  markets  of 
the  world. 

II.    BANKING. 

The  Argentine  delegates  drew  attention  to  the  existing  laws  in  the 
United  States  which  prohibit  the  establishment  of  branches  of  for- 
eign banks.  They  urged  the  committee  to  use  its  influence  in  order 
that  the  States  should  pass  legislation  which  would  enable  branches 
of  foreign  State  banks  to  do  a  general  banking  business  in  this  coun- 
try. A  resolution  was  passed  that  the  advisability  and  fairness  of 
such  legislation  be 'brought  at  once  to  the  attention  of  the  proper 
authorities  in  each  of  the  various  States,  this  legislation  to  be  applied 
only  to  such  countries  as  grant  like  privileges  to  branches  of  Ameri- 
can institutions.  Argentina  expressed  the  belief  that  such  legislation 
would  lead  to  the  establishment  in  the  United  States  of  branches  of 
the  Banco  de  la  Nacion  Argentina,  which  will  lead  to  the  further 
development  of  commerce  between  the  two  countries. 

III.    NAME    OF   MONETARY    UNIT. 

The  committee  adopted  the  resolution  that  the  proposed  Pan 
American  monetary  unit  should  be  called  "  Colon."  This  coin,  as 
agreed  upon  at  an  earlier  Pan  American  conference,  was  to  have  the 
weight  of  0.33437  grams  of  gold  0.900  fine,  and  to  be  subdivided 
according  to  the  decimal  system.  It  is  recommended  that  this  name 
and  unit  be  adopted  as  the  money  for  the  payment  of  all  accounts  in 
international  commerce  of  the  countries  of  the  hemisphere.  It  is  fur- 
ther recommended  that  it  be  adopted  in  each  of  the  various  Republics 
as  opportunity  may  offer,  whenever  the  laws  governing  their  mone- 
tary systems  are  discussed  or  reconsidered. 


REPORT   OF   THE   CONFERENCE    COMMITTEE ARGENTINA.          67 

IV.    CENSUS. 

The  Argentine  delegates  brought  to  the  attention  of  the  other 
members  of  the  group  committee  the  fact  that  several  of  the  South 
American  Republics  have  never  taken  a  census,  and  that  in  many 
other  of  the  Republics  only  very  incomplete  and  meager  statistical 
information  had  ever  been  compiled.  They  suggested  that  every 
effort  be  made  to  influence  all  South  American  Republics  to  pursue  a 
definite  plan  in  the  collection  of  statistical  information  and  that, 
so  far  as  possible,  the  same  information  be  collected  in  all  of  the  Re- 
publics. The  Argentine  delegation  felt  that  the  system  at  present  in 
vogue  in  the  United  States  was  the  most  satisfactory  and  complete, 
and  they  strongly  recommended  that  this  system  be  used  as  a  basis 
throughout  Latin  America,  and  that  this  uniformity  should  apply 
to  the  systematized  statistical  works  as  well  as  to  the  census  and  also 
to  the  definition  of  basic  subjects  and  the  adoption  of  classification 
and  methods.  The  Argentine  delegation  also  pointed  out  that  these 
periods  should  be  agreed  upon  by  all  of  the  Latin- American  Republics 
so  that  they  should  coincide  with  those  of  the  United  States;  that  is, 
at  ten-year  intervals,  beginning  1920.  This  suggestion  met  with  the 
unanimous  approval  of  all  of  the  members  of  this  group. 

V.   COMMERCIAL  ARBITRATION. 

The  following  resolution  was  adopted : 

Resolved,  That  the  Second  Pan-American  Financial  Conference 
recommend  to  the  Secretary  of  Commerce  of  the  United  States 
that  his  department  cooperate  with  business  in  the  United  States 
and  Argentina  in  developing  closer  relations,  by  instructing 
the  consular  and  trade  agents  to  call  attention  to  the  existence 
of  arbitration  boards  maintained  by  chambers  of  commerce  in 
the  United  States  and  Argentina  for  the  prompt  adjustment 
of  business  disputes.  It  is  also  recommended  that  all  the  Re- 
publics of  America,  which  have  not  already  done  so,  adopt  by 
appropriate  laws  and  regulations  the  contract  of  arbitration 
originally  celebrated  between  the  Bolsa  de  Comercio  de  Buenos 
Aires  and  the  Chamber  of  Commerce  of  the  United  States,  sub- 
ject to  such  changes  as  may  from  time  to  time  be  agreed  upon. 

VI.  TAXATION. 

Resolved,  That  in  view  of  the  extension  of  income  and  inherit- 
ance taxes  in  the  various  American  States,  the  International 
High  Commission  be  asked  to  study  the  question  of  the  best 
method  of  avoiding  the  simultaneous  double  taxation  of  indi- 
viduals and  corporations. 


68  SECOND   PAN   AMERICAN    FINANCIAL   CONFERENCE. 

VII.    UNIFORM  LEGISLATION  FOR  CORPORATIONS. 

Resolved,  That  the  International  High  Commission  be  asked 
to  study  the  possibility  of  achieving  uniformity  and  relative 
equality  in  the  provisions  governing  the  organization  and  fiscal 
treatment  of  foreign  corporations  by  the  various  American 
Republics. 

VIII.    COMMERCIAL  ATTACHES. 

Resolved,  That  the  conference  recognizes  the  value  of  the  sys- 
tem of  commercial  attaches  and  urges  upon  Congress  a  substan- 
tial extension  of  the  system. 

IX.    TRADE-MARKS. 

Resolved,  To  recommend  an  early  approval  by  the  Congresses 
of  the  Republics  of  America  of  the  convention  concerning 
copyrights  and  trade-marks  which  was  approved  in  the  Pan 
American  Conference  held  at  Buenos  Aires  in  May,  1910. 

X.    ARGENTINE-AMERICAN   CHAMBER  OF   COMMERCE. 

Resolved,  That  it  should  be  recommended  by  the  Second  Pan 
American  Financial  Conference  that  business  men  having  con- 
nections with  Argentina  should  lend  their  moral  and  personal 
support  to  the  newly  established  organization  of  the  Argentine- 
American  Chamber  of  Commerce  in  New  York,  which  has  been 
created  to  promote  commercial  relations  between  the  two  coun- 
tries. 

Respectfully  submitted. 

The  CONFERENCE  COMMITTEE  FOR  ARGENTINA, 

D.  E.  SALABERRY,  Chairman. 

F.  A.  VANDERLIP,  Vice  Chairman. 


BOLIVIA. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the  SECRETARY  OF  THE  TREASURY  OF  THE  UNITED 
STATES. 

SIR:  This  report  follows  as  closely  as  possible  the  program  of 
topics  agreed  upon  by  the  Governments  of  the  American  Republics 
for  submission  to  the  Second  Pan  American  Financial  Conference. 
This  report  does  not  aim  to  include  any  matter  which  has  been  al- 
ready covered  either  by  the  International  High  Commission  or  by 
any  o-f  the  official  publications  of  the  Bolivian  Government.  It  is 
felt  that  statistical  data  regarding  Bolivia  and  its  relations  with 
other  countries  have  been  so  fully  covered  in  the  publications  of  the 
International  High  Commission  and  of  the  Bolivian  Government 
that  it  will  be  superfluous  to  restate  them. 

The  war  of  1914—1918  stimulated  the  development  of  the  domestic 
resources  of  Bolivia  in  two  distinct  ways:  First,  by  increasing  the 
prices  obtained  abroad  for  staple  mineral  products,  such  as  tin  and 
copper,  in  some  cases  200  per  cent,  and  in  some  even  more ;  and  sec- 
ond, by  enlarging  the  production  and  exportation  of  tungsten  and 
antimony,  two  metals  which  had  never  previously  entered  to  any  con- 
siderable extent  into  international  trade  from  Bolivia.  The  produc- 
tion of  rubber  was  also  continued  and  a  careful  survey  was  made  of 
Bolivia's  agricultural  and  pastoral  resources.  The  exports  of  hides 
doubled,  while  the  value  of  wool  exported  increased  nearly  fiftyfold. 

The  group  conference  report  of  the  First  Pan  American  Financial 
Congress  stated  the  live-stock  resources  of  Bolivia  in  considerable  de- 
tail, and  the  only  new  thing  to  be  added  is  that  the  Bolivians  hope 
that  packing  houses  will  be  erected  in  their  country,  and  that  with 
the  large  amount  of  grazing  land  available,  the  progress  of  the  pack- 
ing industry  in  Paraguay,  another  interior  country,  in  the  last  three 
years,  and  in  Argentina  in  the  last  20  years  will  also  take  place  in 
Bolivia.  It  should  be  noted  that  Bolivians,  like  many  other  South 
Americans,  prefer  to  invest  their  money  in  farms  and  ranches  rather 
than  in  public  loans  and  utilities. 

Bolivia's  international  commerce  increased  by  206  per  cent  between 
1914  and  1918.  During  this  period  the  trade  with  the  United  States 
not  merely  increased  by  one  hundred  and  thirty-sixfold,  but  whereas 
the  United  States  was  Bolivia's  seventh  largest  customer  in  1913, 

69 


70  SECOND   PAX   AMERICAX   FINANCIAL   CONFERENCE. 

England,  Germany,  and  France  being  her  first,  second,  and  third 
largest  customers,  respectively;  in  1918  the  situation  was  wholly  re- 
versed, England  being  Bolivia's  largest  customer,  the  United  States 
second,  Chile  third,  France  fourth,  while  Germany  took  nothing. 
Fully  as  striking  a  change  occurred  in  Bolivia's  imports  during  this 
same  period.  The  relative  rank  of  the  four  most  important  countries 
which  supplied  Bolivia  with  her  imports,  with  the  percentage  sup- 
plied by  each,  is  indicated  by  the  following  table : 


1913 :                                                   Per  cent 
Germany 36.  50 

England 20.27 

Chile 10. 15 

United    States—  7.38 


1918 :  Per  cent. 

United  States 32.51 

Chile 23.11 

Peru 12.  48 

England _  11.85 


Bolivia's  imports  from  the  United  States  in  1918,  the  last  figures 
available,  amounted  to  11,311,209  bolivianos  arid  her  exports  to  the 
United  States  75,991,792  bolivianos,  a  total  trade  of  87,313,001  bolivi- 
anos, or  about  $33,000,000  United  States  money. 

Bolivia's  most  urgent  financial  needs  are  for  railway  and  water- 
power  development  and  for  the  sanitation  of  her  principal  cities, 
and  also  for  the  refinement  of  ores  in  Bolivia  instead  of  sending  them 
out  of  the  country  for  such  processes.  In  general,  it  may  be  stated 
that  the  advance  of  Bolivia  can  best  be  accomplished  by  foreign  in- 
vestment at  the  present  time.  lit  is  noted  that  the  neighboring  Re- 
public of  Chile  has  invested  a  considerable  amount  of  money  in 
Bolivia.  England,  France,  Germany,  and  the  United  States  have 
also  invested  money  in  that  country,  and  the  increase  in  investments 
of  the  United  States  in  Bolivia  has  been  marked  during  the  past 
four  years. 

Probably  no  South  American  country  more  urgently  needs  railway 
development  than  Bolivia,  and  during  the  war  Bolivia  spent  her  own 
resources  on  railway  construction,  borrowing  but  little  for  this  pur- 
pose. It  should  be  borne  in  mind  that  railway  construction  and  de- 
velopment are  extremely  expensive  in  all  parts  of  Bolivia.  Her  most 
important  railway  needs  are  as  follows : 

1.  The  railway  from  Atocha  to  La  Quiaca,  on  the  Argentine 
frontier,  concerning  which  the  following  resolution  was  adopted  by 
the  Bolivian  group  committee  on  January  20,  1920 : 

Whereas  it  has  been  shown  that  the  line  from  Tupiza  to  La 
Quiaca,  of  100  kilometers,  is  now  under  construction,  and  it  is 
confidently  expected  can  be  completed  in  30  months  from  Janu- 
ary 1,  1920;  and 

Whereas  the  stretch  from  Atocha  to  Tupiza,  of  105  kilometers, 
would  then  be  the  only  uncompleted  piece  of  the  entire  line  from 
the  Pacific  to  the  Atlantic,  insuring  through  communication 


REPORT    OF    THE    CONFERENCE    COMMITTEE — BOLIVIA.  71 

from  La  Paz  via  La  Quiaca  to  Buenos  Aires,  therefore  benefit- 
ing that  great  section  of  South  America :  It  is  hereby 

Resolved,  That  it  is  the  sense  of  the  Bolivian  committee  that 
the  banking  interests  of  the  United  States  should  be  encouraged 
to  grant  a  loan  sufficient  to  complete  this  line  (estimated  time  of 
construction,  30  months,  and  estimated  cost,  $5,000,000)  ;  and 
be  it  further 

Resolved,  That  the  Bolivian  committee  support  the  steps 
which  the  Bolivian  Government  has  already  initiated  in  this 
matter. 

2.  The  railway  from  La  Paz  to  the  Beni  River,  through  Yungas, 
and  the  railway  from  Potosi  to  Sucre. 

The  following  resolution  was  also  adopted : 

Whereas  Bolivia  requires  additional  transportation  facilities 
to  link  the  mining  and  industrial  districts  in  the  western  part  of 
the  country  with  the  agricultural  districts  in  the  eastern  part; 
and 

Whereas  modern  sanitation  is  very  necessary  in  the  large 
cities;  and 

Whereas  Bolivia  has  enormous  undeveloped  rich  natural  re- 
sources and  a  debt  of  only  $8.50  per  capita :  Now.  therefore,  be  it 
Resolved,   That,   in   the   judgement   of   the    Bolivian   committee, 
Bolivia  should  have  credit,  in  addition  to  the  amount  necessary 
to  complete  the  railroad  from  Atocha  to  Tupiza,  as  approved 
in  a  previous  resolution  adopted  by  this  committee,  and  that 
such  additional  credit  should  be  granted  in  such  amounts  for 
the  additional  transportation  facilities  and  sanitation  require- 
ments heretofore  mentioned  as  may  be  mutually  agreed  upon  by 
the  Bolivian  Government  and  bankers  of  the  United  States. 
In  reply  to  the  question  as  to  how  the  required  capital  and  credit 
facilities  can  best  be  extended  to  Bolivia,  it  should  be  stated  that  Bo- 
livia's requirements  for  her  public  development  can  not  now  be  met 
by  domestic  capital.     A  large  portion  of  Bolivia's  needs  must  be 
filled  by  foreign  capital  for  many  years  to  come,  and  this  foreign 
capital  will  not  merely  be  obtained  by  credit  granted  to  the  Bolivian 
Government,  but  also  through  United  States  branch  banks  and  com- 
mercial credit  granted  to  Bolivian  merchants.    The  Bolivian  common 
laborer  is  very  effective  in  mining  work,  and  if  the  new  enterprises 
entering  Bolivia  bring  the  necessary  skilled  labor  to  act  as  instruc- 
tors it  is  believed  that  Bolivian  labor  can  also  be  trained  technically. 
The  present  Bolivian  public  debt,  according  to  the  reports  of  the 
central  executive  council  of  the  International  High  Commission, 
is  $25,933,299.94,  of  which  $15,000,000  is  in  external  loans. 

The  national  fiscal  system  has  been  fully  covered  by  the  reports 
of  the  International  High  Commission.    While  Section  IV  of  the 


72  SECOND   PAX   AMERICAN   FINANCIAL   CONFERENCE. 

effect  of  the  war  on  transportation  facilities  only  indirectly  affects 
Bolivia,  Bolivia  is  intensely  interested  in  this  matter  of  ocean  trans- 
portation, and  desires  to  participate  in  any  further  conferences  that 
may  be  held  in  regard  thereto. 

Legislation  is  now  pending  before  the  Bolivian  Congress  on  the 
subject  of  commercial  travelers,  which  is  hoped  will  remove  all 
pending  difficulties,  since  it  will  be  national  in  character.  The 
Bolivian  commercial  code  is  being  revised,  which  will  be  a  great  help 
in  international  commerce. 

Bolivia  accepts  the  conclusions  of  the  Pan  American  Conference 
at  Buenos  Aires  of  1916  regarding  patents  and  copyrights  and  com- 
mercial travelers,  and  she  has  adhered  to  the  Pan  American  Con- 
vention of  1910  regarding  these  matters. 

As  regards  lower  postal  rates,  it  seems  that  the  United  States  pro- 
posed recently  to  all  the  South  American  countries,  Bolivia  included, 
that  they  reduce  their  postal  rates  so  that  the  foreign  rate  on  first- 
class  mail  matter  equal  the  domestic.  While  Bolivia  feels  that  this 
is  desirable,  she  deems  it  best  to  postpone  definite  action  on  this  im- 
portant matter  for  the  present.  Efforts  are  now  being  made  to  im- 
prove the  parcel  post  agreement  of  November  24,  1900,  and  its  sup- 
plementary agreement  of  November  30,  1901,  between  the  United 
States  and  Bolivia.  La  Paz  and  Oruro  are  the  interchange  offices 
in  Bolivia  and  New  York  and  New  Orleans  in  the  United  States. 
This  convention  covers  registered  packages  only  and  should  be  ex- 
tended to  other  classes  of  packages.  The  desire  was  expressed  that 
more  steamers  stop  at  Arica  and  Mollendo  with  mail  of  all  kinds  for 
Bolivia. 

An  interesting  phase  of  this  matter  is  the  development  of  an  inter- 
national parcel  post  between  the  east  and  west  coast  of  South  America 
through  Bolivia.  Bolivia  is  anxious  to  have  a  Pan  American  postal 
congress  meet  at  Buenos  Aires.  Such  a  conference  will  be  held 
shortly  and  the  United  States  has  been  asked  to  participate  in  it.  The 
Bolivian  delegates  recommend  that  the  United  States  adhere  to  the 
Montevideo  postal  convention. 

Bolivia  has  now  a  complete  wireless  system  with  central  stations 
of  100  kilowatts  at  Riberalta  and  Viacha,  which  cover  the  whole 
country. 

The  United  States  had  no  consuls  in  Bolivia  before  1919,  and  it 
is  felt  that  two  or  more  consulates  should  be  established,  one  at  Oruro 
and  one  in  the  eastern  part  of  the  country. 

Steps  have  already  been  taken  to  reorganize  the  Bolivian  National 
Chamber  of  Commerce  in  order  to  complete  and  give  effect  to  an 
agreement  with  the  United  States  Chamber  of  Commerce  along  the 
lines  of  the  agreement  between  the  latter  organization  and  the  Bolsa 


REPORT    OF   THE    CONFERENCE    COMMITTEE BOLIVIA.  73 

de  Comercio  of  Buenos  Aires.     The  Bolivian  chambers  of  commerce 
are  being  reorganized. 

It  was  resolved  by  the  Bolivian  group  committee  that  the  secretary 
of  the  United  States  group  thereof,  Mr.  C.  L.  Chandler,  be  empow- 
ered to  discuss  with  the  officers  of  the  Bureau  of  Foreign  and  Do- 
mestic Commerce  of  the  United  States  Department  of  Commerce  the 
question  of  specifying  the  commodities  composing  Bolivian  trade 
with  the  United  States  in  such  a  manner  as  to  show  their  country  of 
origin,  instead  of  crediting  them  to  Peru.  Chile,  and  other  countries 
through  whose  ports  they  may  have  been  exported  or  imported. 

The  Bolivian  committee,  a  majority  of  whose  members  have  visited 
Bolivia,  in  view  of  the  industrial  and  economic  requirements  of 
Bolivia,  desires  to  express  the  hope  that  some  additional  arrangements 
may  be  effected  in  the  near  future  which  will  permit  it  to  enjoy  a 
fuller  measure  of  transportation,  port,  and  customs  independence. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  BOLIVIA, 

J.  L.  TEJADA,  Chairman. 

JOSEPH  P.  GRACE,  Vice  Chairman. 


BRAZIL. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable, 

THE  SECRETARY  OF  THE  TREASURY  OF  THE  UNITED  STATES. 

SIR:  The  conference  committee  for  Brazil  was  composed  of  the 
following-named  gentlemen :  Dr.  Carlos  Cesar  De  Oliveira  Sampaio, 
chairman;  Mr.  Oscar  T.  Crosby,  vice  chairman;  Dr.  Manoel  Coelho 
Rodrigues  and  Mr.  P.  A.  Martin,  cosecretaries ;  and  the  following 
members :  Messrs.  Chandler  P.  Anderson,  Joseph  H.  Bagley,  William 
S.  Culbertson,  Henry  S.  Dennison,  A.  H.  Dick,  W.  Cameron  Forbes, 
Edward  S.  Huxley,  W.  S.  Kies,  Frederico  Lage,  F.  A.  Molitor, 
William  E.  Peck,  V.  H.  Pinckney,  Theodore  F.  Whitmarsh.  Messrs. 
Gerard  Swope  and  A.  S.  Peabody  were  unable  to  be  present. 

Subcommittees  were  appointed  to  deal  with  each  topic  agreed  upon 
by  the  Governments  of  the  American  Eepublics  for  submission  to  the 
conference.  After  full  discussion  of  the  reports  of  these  subcom- 
mittees the  following  statements,  recommendations,  and  resolutions 
were  adopted : 

I.  THE  EFFECT  OF  THE  WAR  ON  THE  COMMERCE  AND  INDUSTRY,  MANU- 
FACTURING AND  MINING,  AGRICULTURE,  AND  PUBLIC  UTILITIES  OF 
THE  EEPUBLICS  OF  THE  AMERICAN  CONTINENT. 

With  the  sudden  outbreak  of  the  war  Brazil,  like  other  South 
American  countries,  found  herself  cut  off  from  her  banking  facilities. 
While  Brazil  always  has  had  a  large  trade  with  the  United  States, 
before  the  war  this  trade  was  financed  mainly  through  the  instrumen- 
talities of  the  European  banking  agencies.  Just  before  the  declara- 
tion of  war  Brazil  had  under  way  negotiations  looking  toward  the 
rehabilitation  of  her  finances.  The  war  terminated  these  negotia- 
tions. The  Government  of  Brazil  has  not  been  able  to  borrow  any 
new  money  during  the  period  of  war.  Two  of  her  cities,  Rio  de 
Janeiro  and  Sao  Paulo,  have  made  loans  in  the  United  States. 

The  inability  to  make  loans,  coupled  with  the  increase  in  the  ex- 
penses  of  the   Government,  has   resulted   in   an   accumulation   of 
deficits,  an  increase  in  the  national  debt,  and  a  financial  situation 
which  presents  many  difficult  problems. 
74 


REPORT   OF   THE    CONFERENCE    COMMITTEE BRAZIL.  75 

During  the  war  the  amount  of  paper  money  has  been  increased 
rseveral  times.  The  gold  reserve  has  dwindled,  and  to-day  Brazil  may 
be  said  to  be  upon  a  paper  basis.  The  currency,  while  theoretically 
convertible,  is,  in  fact,  inconvertible.  In  spite  of  the  increase  in  the 
circulating  medium  and  the  decrease  in  the  gold  reserve,  the  resources 
of  the  country  and  the  demands  of  business  are  so  great  that  the 
new  issues  of  paper  money  have  been  absorbed  and,  as  a  matter  of 
fact,  the  milreis  in  the  markets  of  the  world  to-day  has  a  higher 
exchange  value  than  several  years  ago.  To  summarize  the  effect  of 
the  war  upon  the  finances  of  the  Brazilian  Government,  it  may  be 
:said  that  the  war  has  brought  additional  complications  to  an  already 
difficult  governmental  financial  situation. 

Brazil's  banking  and  financial  situation  merits  thoughtful  and 
intensive  study  with  the  purpose  of  developing  a  comprehensive 
financial  plan  to  meet  the  situation.  Brazil's  resources  and  her  pos- 
sibilities for  wealth  are  so  great  that  her  debt  is  not  burdensome. 
The  immense  physical  resources  of  the  country  and  the  high  moral 
character  of  the  nation  itself  furnish  a  background  of  security  which 
should  facilitate  the  carrying  out  of  a  comprehensive  financial 
program. 

While  the  war  has  complicated  the  problems  of  the  Government  of 
Brazil,  it  has  brought  to  the  Brazilian  people  certain  advantages  in 
the  development  of  a  greater  dependence  upon  their  own  resources. 
The  war  interrupted  shipping  facilities,  commercial  relationships, 
interfered  with  established  lines  of  business,  cut  off  some  of  the 
chief  markets  for  Brazilian  products,  and  in  other  ways  affected 
the  business  progress  of  the  country.  After  the  first  shock 
Brazil  started  to  work  to  do  for  itself  what  it  could  in  the 
development  of  its  resources.  It  has  accomplished  much  during 
the  war.  Vast  stretches  of  land  have  been  put  under  production. 
Great  impetus  has  been  given  to  the  cattle  industry.  Brazil  has 
increased  its  production  in  cotton,  corn,  and  in  other  food  prod- 
ucts. Its  cotton-manufacturing  industry  has  shown  remarkable 
strides,  and  to-day  at  the  close  of  the  war  Brazil  is  commercially 
and  economically  sound.  While  prices  have  risen  in  many  lines, 
there  has  been  no  general  inflation.  A  good  many  public  improve- 
ments have  been  carried  out  with  Brazilian  money,  but  Brazil's 
•development  has  not  yet  reached  the  point  where  it  is  able  to 
accumulate  sufficient  capital  to  build  railroads,  extend  its  public 
utilities,  develop  its  natural  resources,  and  carry  out  a  program  of 
public  improvements ;  its  capital  is  all  put  to  use  in  the  development 
of  new  lands,  in  the  upbuilding  of  industries  based  upon  its  natural 
resources.  It  must,  therefore,  be  dependent  upon  outside  capital 
for  years  to  come  for  the  construction  of  railroads  and  the  carrying 
on  of  large  public  improvements.  The  obtaining  of  money  for  these 


76  SECOND  PAN   AMERICAN   FINANCIAL   CONFERENCE. 


purposes  through  loans  from  the  United  States  or  any  other  country 
depends  upon  the  general  credit  of  Brazil,  and  this  in  turn  depends; 
upon  the  working  out  of  Brazil's  financial  problem  as  herein  set 
forth. 

Brazil  has  probably  attained  a  greater  degree  of  economic  inde- 
pendence during  the  war  than  almost  any  of  the  Pan  American 
countries;  this  on  account  of  diversity  of  its  resources.  With  the 
exception  of  coal  Brazil  is  abundantly  supplied  with  practically  all 
of  the  important  natural  resources.  Certain  low-grade  deposits  of 
coal  have  been  developed  during  the  Avar,  but  Brazil  will  probably 
always  be  a  purchaser  of  coal.  In  this  connection  an  interesting 
fact  may  be  noted  in  that  a  substantial  market  for  coal  from  the 
United  States  has  been  developed,  but  the  permanence  of  this  market 
will  depend  to  a  very  large  extent  upon  improved  shipping  facilities- 
between  Brazil  and  the  United  States. 

The  development  of  Brazil's  economic  independence  has  been  de- 
layed by  the  war  in  so  far  as  it  has  been  unable  to  raise  capital  to  de- 
velop those  resources  which  would  materially  aid  it  in  achieving  its 
economic  independence.  In  this  connection  may  be  mentioned  the 
enormous  iron-ore  deposits  in  Brazil  and  the  country's  ambition  to* 
develop  a  steel  industry  sufficient  to  take  care  of  its  needs. 

URGENT    PRESENT    PUBLIC   FINANCIAL    NEEDS. 

This  subject  has  been  covered  above  in  the  discussion  of  Brazil's 
financial  situation.  Governmental  financing  will  be  difficult  without 
the  working  out  of  a  comprehensive  financial  program  which  will 
necessitate  fundamental  changes  in  the  banking  and  currency  sys- 
tems. 

The  development  of  public  utilities  in  Brazil  has  been  substantial ; 
practically  every  city  of  any  size  is  well  lighted,  and  all  the  larger 
cities  have  street  railways  and  modern  conveniences.  The  water- 
power  developments  in  the  cities  of  Rio  de  Janeiro  and  Sao  Paula 
have  resulted  in  making  Rio  de  Janeiro  one  of  the  best-lighted  cities 
in  the  world.  Power  in  both  of  these  cities  is  cheap,  and  Brazilians 
have  every  right  to  be  proud  of  these  enterprises.  Railroad  develop- 
ment has  been  backward  and  vast  areas  of  extremely  fertile  land 
will  become  accessible  by  the  extension  of  railroads-  New  equip- 
ment and  increase  of  facilities  in  the  case  of  many  existing  lines  is 
urgently  needed. 

URGENT    PRESENT    FINANCIAL   NEEDS    IN    COMMERCE    AND    INDUSTRY. 

The  banking  facilities  of  Brazil  are  well  developed  and  the  ordi- 
nary commercial  needs  of  the  country  are  well  served.  In  certain  in- 
dustries capital  is  needed  to  install  machinery  which  will  result  im- 


REPORT   OF   THE   CONFERENCE   COMMITTEE BRAZIL.  77 

mediately  in  increasing  production;  particularly  is  this  true  in  the 
sugar  industry.  The  installation  of  modern  sugar  mills  would  result 
in  a  far  greater  percentage  of  extraction  and  a  subsequent  very  sub- 
stantial gain  in  actual  production  of  sugar. 

The  .sugar  industry  in  Brazil  is  in  immediate  need  of  capital  to  do 
away  with  the  severe  economic  loss  occasioned  by  the  use  of  primitive 
methods  and  antiquated  mills. 

Brazil's  rubber  industry  has  prospered  during  the  war.  Consider- 
ing the  fact  that  the  cultivated  rubber  which  is  used  so  largely  in  the 
rubber  industry  had  its  origin  in  Brazil,  we  feel  that  Brazil  has  op- 
portunities for  great  expansion  along  these  lines.  Capital  in  the 
rubber  industry  is  needed  and  should  produce  favorable  results. 

The  coffee  situation  is  good. 

The  production  and  exportation  of  manganese  was  largely  in- 
creased during  the  war  and  it  is  believed  that  the  figures  then  reached 
will  be  maintained. 

Brazil,  in  common  with  other  American  countries,  is  a  great  pro- 
ducer of  raw  materials,  and,  considering  the  world's  present  need  of 
raw  materials  of  all  kinds,  it  would  seem  that  Brazil  and  other  pro- 
ducing countries  should  receive  consideration  in  their  needs  for  capi- 
tal for  the  development  of  the  natural  resources  which  will  materially 
contribute  toward  feeding  and  clothing  the  world. 

II.  How  CAN  REQUIRED  CAPITAL  AND  CREDIT  FACILITIES  BEST  BE 

PROVIDED  ? 

The  subcommittee  recognizes  that  the  resources  of  Brazil  are  so 
large  that  properly  to  develop  them  not  only  can  all  the  available 
domestic  capital  be  used  but  also  as  much  foreign  capital  as  might 
be  secured.  At  the  present  stage  of  development,  it  is  our  opinion 
that  the  best  interests  of  the  country  require  the  use  of  as  much 
domestic  capital  as  possible  in  commercial  and  agricultural  pursuits 
and  that  railroad,  public  utility,  and  industrial  development  can 
best  be  financed  by  foreign  capital. 

The  necessary  banking  and  credit  facilities  for  trade  between  the 
United  States  and  Brazil  have  in  years  past  been  supplied  almost 
entirely  by  the  agencies  in  the  United  States  or  European  banks.  Ow- 
ing to  the  lack  of  American  banking  facilities,  the  American  export- 
ers were  placed  in  an  embarrassing  situation  at  the  beginning  of  the 
World  War  owing  to  the  withdrawal  of  the  facilities  which  had  been 
previously  extended  to  them  by  the  European  banks.  These  facilities 
have  been  supplemented  in  recent  years  by  the  establishment  of 
American  branch  banks  which  relieved  the  situation  to  a  considerable 
extent.  In  view  of  past  occurrences,  however,  it  is  our  opinion,  that 
to  safeguard  properly  the  commercial  interests  of  both  Brazil  and  the 


78  SECOND   PAN    AMERICAN   FINANCIAL   CONFERENCE. 

United  States  it  is  of  the  utmost  importance  that  American  banking 
facilities  should  be  extended  to  a  point  commensurate  with  the  trade 
between  the  two  countries. 

It  also  would  seem  desirable  to  encourage  the  establishment  of 
agencies  or  branches  of  Brazilian  banks  in  the  United  States,  and 
the  committee  therefore  recommends  that  the  lawrs  of  the  various 
States,  and  in  so  far  as  necessary  the  laws  of  the  United  States,  be 
so  changed  as  to  permit  the  establishment  of  branches  of  foreign 
banks  in  the  United  States  under  such  general  conditions  as  branches 
of  American  banks  are  permitted  in  such  foreign  countries,  subject, 
however,  to  the  same  general  regulations  governing  deposits  and 
banking  practice  as  are  applied  to  American  banks. 

The  committee  notes  with  satisfaction  the  growth  of  the  use  of 
the  acceptance  in  commercial  business  between  the  United  States 
and  Brazil.  The  narrowness  of  the  New  York  acceptance  market 
due  to  high  money  rates  has  increased  the  cost  of  financing  foreign 
business,  but  as  the  conditions  approach  normal  and  a  wider  accept- 
ance market  is  developed  in  the  United  States  we  believe  the  accept- 
ance will  be  found  to  be  the  most  efficient  instrument  in  the  financing- 
of  foreign  trade. 

There  has  been  developed  in  recent  years,  particularly  since  the 
beginning  of  the  European  war,  a  limited  market  in  the  United 
States  for  foreign  securities.  While  the  loans  floated  have  been 
almost  entirely  of  a  governmental  nature,  the  American  investing 
public  should  be  encouraged  in  every  possible  way  to  invest  part  of 
their  capital  in  foreign  securities,  as  such  loans  are  productive  of 
good  feeling  and  closer  relationship  between  the  countries  involved. 
Moreover,  the  investment  of  American  capital  in  railroad,  public- 
utility,  and  industrial  enterprises — controlling,  as  it  would,  the  pur- 
chasing of  the  necessary  materials — would  insure  not  only  the  con- 
tinuance but  the  growth  of  commercial  relations  between  the  coun- 
tries. (See  resolutions  below.) 

The  important  fact  must  not  be  overlooked  that  there  is  always 
present  the  necessity  for  a  close  observation  on  the  part  of  borrow- 
ing nations  of  the  laws  and  customs  of  the  countries  in  which  loans 
are  sought,  and  the  committee  wishes  to  emphasize  the  importance 
to  countries  needing  outside  capital  for  the  development  of  their 
resources  and  industries  of  a  policy  of  cordial  treatment  of  such 
capital.  Moderate  taxation  and  freedom  from  annoying  or  burden- 
some restrictions  will  undoubtedly  result  in  encouraging  capital  to 
flow  more  freely  into  the  needed  channels. 

Bearing  on  the  general  subject  treated  by  this  section  of  the 
report,  the  following  resolutions  were  adopted : 

Whereas  investors  in  the  United  States  are  accustomed  to 
certain  corporate  forms  of  organization  and  to  certain  legal 


REPOKT    OF- THE    CONFERENCE    COMMITTEE BRAZIL.  79 

safeguards  in  connection  with  property  pledged  as  security  for 
bonds,  notes,  and  other  evidences  of  indebtedness:  Be  it 

Resolved,  That  the  committee  respectfully  calls  to  the  atten- 
tion of  ithe  South  American  countries  the  desirability  of  so 
modifying  their  banking  laws  as  to  permit  the  establishment 
of  banking  institutions  fulfilling  the  same  general  functions  as 
those  of  the  trust  companies  of  the  United  States. 

Whereas  both  in  the  United  States  and  England  the  use  of 
preferred  stock  has  been  found  very  convenient  in  the  financing 
of  railroad,  public  utility,  and  industrial  enterprise;  and 

Whereas  the  laws  of  Brazil  do  not  recognize  such  a  form  of 
stock :  Now  be  it 

Resolved,  That  this  committee  recommends  that  the  Brazilian 
Government  take  under  consideration  an  amendment  of  the  law 
regulating  the  organization  of  corporations  in  Brazil  so  as  to 
permit  the  issuance  of  both  preferred  and  common  stock,  which 
would  facilitate  the  securing  of  foreign  capital  for  the  develop- 
ment of  the  resources  of  Brazil. 

Whereas  the  proper  development  of  railroad  facilities,  so  im- 
portant to  the  welfare  of  Brazil,  requires  the  use  of  considerable 
equipment;  and 

Whereas  equipment  trust  certificates  have  been  found  ex- 
tremely useful  in  the  railroad  development  of  the  United  States ; 
and 

Whereas  the  issuance  of  such  equipment  trust  certificates  is 
not  permitted  under  the  Civil  Code  of  Brazil :  Now  be  it 

Resolved, .  That  the  committee  recommends  that  the  Govern- 
ment of  Brazil  take  under  consideration  amending  its  civil  code 
so  as  to  permit  the  pledging  of  railroad  equipment  as  security 
for  equipment  trust  certificates. 

III.  NATIONAL  CREDIT  AND  THE  FACTORS  AFFECTING  IT. 

EXTENT  AND  NATURE  OF  THE  PUBLIC  DEBT. 

In  May,  1919,  the  public  debt  of  Brazil  was  calculated  to  be 
:,104 : 539$272,  the  equivalent  in  United  States  currency  equaling 
>1,133,864,440.  The  nature  of  the  debt  was  as  follows: 

(Milreis.) 

Foreign  debt 2, 048 :  965$032 

Domestic  debt 798:202$760 

2,  847  : 167$792 

Paper  money—. 1,  257 :  421$480 


4, 104 :  589$272 


80  SECOND   PAN   AMERICAN   FINANCIAL  CONFERENCE. 

(United   States   currency.) 

Foreign  debt $566, 122,  440 

Domestic  debt 220,  498, 000 

*   $786,  620,  440 

Paper  money 347,345,000 


$1, 133,  965,  440 
Exchange  rate  used,  3.62  paper  milreis  equal  $1. 

This  figure  does  not  include  any  State  or  municipal  debts.  Taking 
25,000,000  as  the  population  of  Brazil,  the  debt  per  capita,  equals 
$45.35.  The  debts  of  the  following  foreign  countries  afford  means  of 
comparison : 

Peru $6.  50 

Chile 11.50 

Argentina r 96.88 

Bolivia—^ 7.  00 

Nicaragua 63.  95 

In  1914  the  Brazilian  Government  suspended  cash  payments  of 
interest  and  sinking  fund,  funding  interest  until  1917.  In  1917  the 
Government  resumed  cash  payments  of  interest.  Resumption 
of  operation  of  the  sinking  fund  has  been  postponed  until  1927. 
(Report  of  International  High  Commission.) 

NATIONAL  FISCAL  SYSTEM  WITH  SPECIAL  REFERENCE  TO  SOURCES  AND 
ADEQUACY   OF   REVENUES. 

As  Dr.  Sampaio,  the  distinguished  delegate  from  Brazil,  has 
very  ably  stated,  a  country  may  be  said  to  have  a  sound  fiscal  policy 
if  its  revenues  are  sufficiently  large  to  pay  all  the  expenses  of  the 
Government  and  interest  and  provide  for  the  ultimate  extinction  of 
the  public  debt.  Brazil  does  not  show  sufficient  revenues  to  meet  these 
requirements.  Brazil,  until  recently,  derived  its  main  sources  of 
revenue  from  import  duties,  approximately  two-thirds  of  its  entire 
revenue  being  raised  from  these  sources.  While  specific  duties  are 
paid  upon  a  large  number  of  articles,  the  duties  collected  on  an  ad 
valorem  basis  comprise  the  greater  part  of  the  revenue.  According 
to  Brazilian  law,  duties  on  imports  go  to  the  national  treasury,  while 
all  revenues  collected  from  exports  go  to  the  State  treasuries,  ex- 
cepting for  the  Territory  of  Acre.  The  failure  to  secure  tonnage 
and  other  conditions,  arising  from  the  exigencies  of  war,  resulted  in 
a  marked  falling  off  in  the  import  tonnage  which  reflected  upon  the 
revenue  of  the  country. 

The  following  figures  (from  reports  of  the  Interantional  High 
Commission)  show  the  decline  of  imports:  . 


REPORT   OF   THE    CONFERENCE    COMMITTEE — BRAZIL.  81 

Value  of  imports. 

1900 $161.  250,  000 

1913 180,  000,  000 

1914 251,  873,  850 

1916 , 155,  440,  597 

1918 259,  224, 110 

1919  (first  6  months) 187,932,216 

The  large  increase  in  the  value  of  imports  in  1918  is  not  due  to  the 
corresponding  increase  of  tonnage,  but  due  to  the  rapid  increase  of 
prices. 

The  following  table  shows  the  annual  deficits  for  the  years  1914 
to  1916 : 

Annual  deficits. 


Gold. 

Paper. 

1914 

275-2178876 

328,  616:5688204 

1915  

30,  707:9208601 

217,484:1938898 

1916  

22.  860:2328746 

156,  905:4888924 

1917 

39  004-4778817 

205  173-8738959 

1918  

34,  448:6418582 

67,417:1928289 

127,  296:4908622 

975,  597:3178274 

According  to  the  budget  of  1919,  there  will  be  an  estimated  deficit 
of  $6,713,714  United  States  currency. 

The  war  caused  a  correspondingly  large  decline  in  the  imports  of 
all  of  the  South  American  countries,  imports  from  Argentina,  lor 
example,  falling  from  $408,711,000  in  1913  to  $210,887,000  in  1916. 

Cuba  shows  a  constant  gain  in  its  import  trade,  this  being  due, 
however,  to  the  preponderance  of  commerce  with  the  United  States. 

The  authorities  of  Brazil  have  come  to  the  realization  that  it  is  not 
wise  to  depend  too  much  upon  any  one  source  of  revenue.  It  is  with 
great  satisfaction  that  the  committee  reports  that  the  Brazilian  Gov- 
ernment has  already  commenced  to  increase  its  collections  from  in- 
ternal revenues  and  will  not  in  the  future  be  so  far  dependent  upon 
the  revenue  derived  only  from  customs.  If  the  present  plans  of  the 
Brazilian  Government  are  realized  the  country  will  have  an  excess 
of  revenue  over  expenditure  at  a  very  early  date  which  should  reflect 
itself  on  the  value  stability  of  its  currency. 

Besides  taxes  levied  to  produce  Federal  revenues,  there  are  taxes 
levied  by  the  States.  Just  care  should  be  exercised  by  the  Federal 
and  State  authorities  to  prevent  such  taxes  becoming  prohibitive. 

RELATION  OF  THE  FISCAL  SYSTEM  AND  CURRENCY  REFORM. 

The  committee  is  pleased  to  concur  with  the  economic  principles 
set  forth  by  the  distinguished  representative  from  Brazil,  Dr.  Sam- 
14970—21 6 


82  SECOND   PAX   AMERICAN    FINANCIAL   CONFERENCE. 

paio,  that  the  first  step  in  currency  reform  is  to  place  the  financial 
operation  of  the  country  on  a  paying  basis,  and  when  the  steps  now 
adopted  by  the  Brazilian  Government  shall  become  effective  and  the 
budget  shows  sufficient  revenue  to  meet  all  of  the  obligations  of  the 
Government,  including  interest  a"nd  amortization  of  the  public  debt,, 
together  with  an  adequate  gold  reserve  and  effective  methods  of  con- 
version, there  is  no  reason  why  there  should  be  any  difference  in  the 
market  price  between  official  gold  milreis  and  the  current  paper. 
Such  stability  of  currency  is  greatly  to  be  desired  and  would  have  a 
beneficial  effect  not  only  upon  the  internal  industries  of  the  country 
itself  but  upon  the  external  trade. 

WHAT  GUARANTEES  AND  REMEDIES  ARE  PROVIDED  BY  LAW  IN  THE  CASE  OF 
PROVINCIAL  AND  MUNICIPAL  LAW. 

The  Brazilian  Government  assumes  no  responsibility  for  the  pay- 
ment of  principal  or  interest  of  State  or  municipal  debts.  Foreign 
creditors  have  recourse  in  the  Federal  courts  under  the  judicial  code, 
which  is  of  Federal  enactment,  and  therefore  uniform  for  all  the 
States,  in  pleasing  contrast  to  the  variety  of  procedures  that  prevail 
in  the  United  States. 

There  is  a  provision  for  foreign  Governments  to  bring  suits  on 
behalf  of  the  Government  or  individual  citizen  in  the  Federal  Su- 
preme Court.  This  procedure  has  not  as  yet  been  used. 

The  loans  usually  carry  a  clause  containing  a  mortgage  provision. 

IV.  THE  EFFECT  OF  THE  WAR  ON  TRANSPORTATION  FACILITIES;  RE- 
QUIREMENTS OF  THE  PRESENT  AND  IMMEDIATE  FUTURE. 

The  subcommittee  appointed  to  study  this  topic  submitted  the 
following  resolutions,  which  were  adopted  by  the  conference  com- 
mittee as  a  whole : 

Whereas  the  chairman  of  the  Shipping  Board  has  announced 
a  proposed  service  to  the  east  coast  of  South  America  by  pas- 
senger ships  which  apparently  are  limited  to  15  knots  an  hour 
and  of  comparatively  small  tonnage ;  and 

Whereas  the  committee  believes  the  needs  of  South  America 
are  such  that  the  service  as  announced  is  inadequate,  and 
that  the  interests  of  North  and  South  America  demand  quicker 
and  more  frequent  communications  and  ships  of  a  larger  size 
to  meet  the  competition  of  other  maritime  nations:  Therefore, 
be  it 

Resolved,  That  this  Brazil  conference  committee  place  itself 
on  record  to  the  effect  that  the  relations  between  North  and  South 


REPORT   OF   THE    CONFERENCE    COMMITTEE BRAZIL.  83 

America  are  so  important  and  the  possibilities  of  the  develop- 
ment of  business  between  North  America  and  the  eastern 
coast  of  South  America  are  so  great  as  to  make  it  desir- 
able that  ships  be  provided  for  the  carriage  of  passengers,  18 
knots  per  hour  and  from  eighteen  to  twenty  thousand  tons  in 
size,  and  that  the  service  to  ports  not  capable  of  receiving  such 
steamers  be  handled  by  transshipment. 

The  following  resolution  dealing  with  both  ocean  and  land  trans- 
portation was  adopted : 

Resolved,  That  it  be  suggested  to  the  various  Governments 
here  represented  that  they  authorize  suitable  commissions  to 
consult  with  other  such  commissions,  with  a  view  to  considering 
in  detail : 

I.  OCEAN     TRANSPORTATION. 

1.  The  establishment  of  fast  passenger  and  mail  service  be- 
tween North  America  and  the  east  coast  of  South  America  in 
order  to  adequately  provide  this  urgently  needed  service. 

2.  The  establishment  of  freight  steamers  which  will  be  as 
large  as  economically  possible,  having  in  view  port  depths  and 
facilities  in  the  various  harbors. 

3.  The  establishment   of  suitable  combinations  between   the 
transoceanic  and  the  coastwise  shipping  of  the  various  coun- 
tries, in  order  that  through  rates,  including  transfer  services, 
can  be  secured  and  continuous  shipments  made  from  larger  to 
the  smaller  ports  at  which  the  transoceanic  steamers  do  not 
touch. 

II.  LAND    TRANSPORTATION. 

1.  The  question  of  standardization  of  railroad  equipment,  in 
so  far  as  that  may  be  possible. 

2.  The  establishment  of  through  railroad  rates  and  uniform 
traffic  regulations  in  order  to  facilitate  through  shipments  be- 
tween the  various  States  and  countries. 

The  committee  desires  to  put  itself  on  record  as  concurring  in  the 
new  policy  which  it  is  understood  has  been  adopted  by  the  Govern- 
ment of  Brazil  when  assisting  the  construction  of  railroads.  This 
policy  is  to  guarantee  interest  upon  the  amount  expended  in  the 
construction  of  railroads,  the  route,  distance,  specification,  and  esti- 
mated cost  having  been  previously  determined  by  surveys  approved 
by  the  Government. 

The  old  system  of  guaranty  upon  a  kilometer  basis  was  uneco- 
nomical both  for  construction  and  operation. 


84  SECOND  PAN   AMERICAN   FINANCIAL   CONFERENCE. 

V.  MEASURES  TO  FACILITATE  COMMERCIAL  INTERCOURSE  AMONG  THE 
AMERICAN  REPUBLICS. 

THE  CONVENTION  CONCERNING  COMMERCIAL  TRAVELERS. 

The  convention  concerning  commercial  travelers  advocated  by  the 
International  High  Commission  has  been  approved  by  Brazil,  but 
no  authority  to  sign  has  been  granted.  One  of  the  obstacles  in  the 
case  of  Brazil  is  the  autonomy  of  the  Brazilian  States.  It  has  been 
the  practice  of  these  States  to  charge  fees  to  commercial  travelers 
within  their  borders,  and  this  has  become  an  important  source  of 
income  for  many  of  these  States.  In  addition  to  these  State  taxes, 
there  is  also  a  tax  on  commercial  travelers  assessed  by  the  Federal 
Government  of  Brazil. 

This  convention, would  do  away  with  this  practice  and  also  pro- 
vide for  the  free  entry  of  samples  without  commercial  value. 

The  United  States  has  signed  and  ratified  this  convention  with 
several  American  Republics. 

Recommended,  That  this  convention  have  further  consideration 
by  the  countries  concerned  with  a  view  to  the  removal  of  the  diffi- 
culties above  stated. 

THE    CONVENTION    TO    ESTABLISH    AN    INTERNATIONAL    GOLD    CLEARANCE 

FUND. 

This  convention,  advocated  by  the  International  High  Commission, 
has  been  approved  by  Brazil  in  principle  but  has  not  been  signed. 

The  United  States  has  signed  this  convention  with  several  Ameri- 
can Republics,  but  has  not  ratified  it. 

Recommended,  That  the  gold  clearance  fund  convention  be  modi- 
fied in  the  light  of  our  war  experience  and  it  thereupon  be  ratified. 

PARCEL   POST  FACILITIES   AND   LOWER   POSTAL  RATES. 

A.  A  parcel  post  convention  has  been  entered  into  between  the 
United  States  end  Brazil.  The  effective  operation  of  this  conven- 
tion would  be  stimulated  by  the  extention  of  parcel  post  facilities  in 
Brazil,  which  at  the  present  time  are  confined  to  comparatively  few 
localities.  At  present  each  country  retains  the  receipts  which  it 
takes  in.  The  business  in  parcel  post  from  the  United  States  to 
Brazil  far  exceeds  the  parcel  post  business  from  Brazil  to  the  United 
States.  It  is  possible  that  a  different  division  of  receipts  would  be 
advantageous  to  both  countries. 

Recommended  (1)  That  the  postal  authorities  of  both  Governments 
give  consideration  to  the  question  of  making  such  changes  in  the 
convention  as  may  be  advantageous  for  stimulating  the  parcel  post 
service. 


REPORT   OF   THE   CONFERENCE    COMMITTEE BRAZIL,  85 

(2)  That  the  system  of  parcel  post  distribution  in  Brazil  be  ex- 
tended. 

B.  Lower  postal  rates:  Lower  postal  rates  are  unquestionably  de- 
sirable, but  it  is  questioned  whether  with  the  existing  facilities  and 
present  general  conditions  this  is  an  opportune  time  for  a  recom- 
mendation. But  it  does  seem  possible  that  with  other  means  of  trans- 
porting mail,  in  line  with  the  present  aerial  development,  lower  postal 
rates  may  be  brought  about,  and  that  this  end  may  be  more  readily 
attained  ii*  there  be  established  an  international  training  ground  for 
the  development  of  an  international  aviation  service,  with  the  idea 
of  establishing  at  the  earliest  possible  moment  an  international  aerial 
postal  service,  including  parcel  post. 

CABLE   FACILITIES WIRELESS   TELEGRAPHY. 

At  present  there  is  no  wireless  between  Brazil  and  the  United  States,, 
and  the  only  means  of  cable  communication  is  either  on  the  English 
line  via  England  or  on  the  All- American  lines  via  Argentina  and 
Chile.  Inasmuch  as  communication  is  necessarily  precedent  to  com- 
mercial development,  it  is  obvious  that  before  there  can  be  any  ma- 
terial advancement  in  our  commercial  relations  improved  communi- 
cations are  imperative.  Improved  communications  may  take  either 
the  form  of  a  direct  cable  connection  between  the  United  States  and 
Brazil  along  the  east  coast  or  an  extension  of  the  line  already  exist- 
ing from  here  to  Colon.  In  addition  there  should  be  established 
wireless  stations  for  communication  between  the  United  States  and 
Brazil,  the  stations  in  each  country  to  be  owned  and  controlled  by  the 
country  in  which  they  are  located. 

One  of  the  obstacles  to  be  overcome  in  the  establishment  of  direct 
cable  communication  between  the  United  States  and  Brazil  along 
the  east  coast  is  a  concession  presumably  granting  to  a  French  com- 
pany the  exclusive  right  to  establish  cable  communications  between 
the  United  States  and  Brazil. 

Resolved,  That  it  be  suggested  to  the  various  Governments 
here  represented  that  they  authorize  suitable  commissions  to  con- 
sult with  other  such  commissions,  with  a  view  to  consider  tech- 
nical details  of  through  rates  and  construction  of  new  cable  lines 
and  radio  facilities. 

THE   ESTABLISHMENT   OF   FREE  PORTS. 

The  establishment  of  free  ports  as  a  facility  of  commerce  is  ap- 
proved. If  established  in  the  United  States  and  at  the  Canal  Zone 
they  would  facilitate  transshipment  trade  with  the  other  Americas 
and  a  wider  distribution  of  materials  and  manufactured  products 
throughout  the  world.  If  established  in  Brazil  at  such  points  as> 


86  SECOND   PAN   AMERICAN    FINANCIAL   CONFERENCE. 

Para  they  would  facilitate  transshipment  trade  up  the  Amazon  with 
Bolivia  and  Peru.  Where  private  companies  have  port  concessions 
their  rights  must  be  considered. 

Recommended,  to  the  Republics  of  the  Americas,  That  permissive 
legislation  be  enacted  authorizing  the  establishment  of  free  ports  or 
zones  in  any  port  fulfilling  specified  requirements  having  regard  to 
the  local  conditions,  laws,  contracts,  and  the  possibility  of  contra- 
band activities. 

VI.  THE  DEVELOPMENT  OF  UNIFORMITY  OF  LEGISLATION. 

Your  subcommittee  on  Section  VI  believes  that  while  uniformity 
of  legislation  would  be  highly  desirable,  yet  its  consummation  is  im- 
practicable. A  simplification  of  procedure  and  of  forms  will,  we 
believe,  bring  about  better  and  more  immediate  results  and  will  in 
Itself  be  an  approach  to  uniformity. 

In  the  matter  of  customs  regulations  we  believe  the  problems  in- 
volved are  local  and  not  susceptible  of  uniform  treatment. 

Undervaluation  of  merchandise  with  intent  to  defraud  is  so  repre- 
hensible as  to  merit  drastic  treatment.  We  make  no  recommenda- 
tions as  to  penalties,  but  offer  the  suggestion  that  plans  be  studied 
having  for  their  purpose  the  elimination  or  reduction  of  the  ad 
valorem  duties  where  the  enforcement  of  true  valuation  is  difficult. 

Consular  invoices  and  procedure  should  receive  the  maximum  of 
simplification,  since  it  is  essential  that  the  minimum  of  time  should 
be  consumed  in  the  preparation  of  the  documents.  We  suggest  that 
consular  invoices  be  so  designed  as  to  permit  their  being  filled  out  on 
the  typewriter.  Columns  for  the  total  number  of  packages  and  the 
total  weight  of  shipment  seem  to  be  all  that  is  necessary,  since  the 
total  thus  written  will  preclude  change  of  figures  in  any  separate 
Items.  Errors  in  the  preparation  of  consular  invoices  should  be  per- 
mitted to  be  remedied  by  an  explanatory  letter.  The  various  con- 
sulates of  any  one  nation,  regardless  of  their  location,  should  use 
uniform  documents.  We  regard  the  matter  of  simplification  of  con- 
sular forms  and  procedure  of  sufficient  importance  to  suggest  that  a 
consular  conference  be  called  at  an  early  date,  the  membership  to  be 
composed  of  Pan  American  consular  officials. 

The  limited  time  at  our  disposal  has  precluded  any  intensive  study 
of  port  dues,  sanitary  requirements,  wharfage,  customs  classification, 
and  nomenclature,  etc. 

We  believe  that  the  matter  of  negotiable  instruments  and  com- 
mercial contracts  should  be  approached  on  the  basis  of  the  moral 
obligations  rather  than  the  legislative  enactments  behind  them. 
Even  when  laws  differ,  practice  can  approach  uniformity  by  the 
development  of  mutual  agreements  based  upon  the  moral  obliga- 


REPORT   OF   THE    CONFERENCE    COMMITTEE — BRAZIL.  87 

tions  of  good  business.  Sound  practice  thus  established  will  be  even- 
tually crystallized  into  law.  We  hope  that  agreements  embodying 
the  same  principles  as  those  existing  bet\veen  the  Chambers  of  Com- 
merce of  Buenos  Aires,  Montevideo,  and  Guayaquil  and  the  Cham- 
ber of  Commerce  of  the  United  States  will  be  speedily  concluded  with 
the  appropriate  business  organizations  of  Brazil. 

We  indorse  the  purposes  of  the  American  International  Union 
for  the  Protection  of  Trade-Marks  and  recommend  that  it  receive 
the  support  of  all  the  nations  of  the  Americas. 

We  refrain  from  recommendations  in  the  matter  of  uniform 
admiralty  law,  believing  the  subject  «to  require  more  time  for  its 
study  than  has  been  placed  at  the  disposal  of  the  subcommittee. 

ADDITIONAL  RECOMMENDATIONS. 

At  the  instance  of  the  Hon.  John  Barrett,  Director  of  the  Pan 
American  Union,  the  conference  committee  adopted  the  following 
recommendations : 

First.  That  each  government  of  the  Pan  American  Union 
shall  arrange  that  regularly  and  permanently  its  various  depart- 
ments and  bureaus  shall  deposit  in  the  library  of  the  Pan 
American  Union  two  copies  of  all  informative  official  publica- 
tions, maps,  and  other  data,  including  the  report  of  the  Treasury 
and  other  financial  agencies ; 

Second.  That  each  Government  consider  the  advisability  of 
preparing  under  its  direction  a  comprehensive  standard  hand- 
book in  English  describing  its  financial,  commercial,  material, 
and  other  conditions,  to  be  distributed  through  the  Pan  Ameri- 
can Union ; 

Third.  That  each  Government  deposit  in  the  Pan  American 
Union,  for  exhibit  whenever  necessary,  films  descriptive  of  its 
life  and  resources;  and 

Fourth.  That  every  effort  be  made  by  each  Government  to 
make  the  Pan  American  Union  a  practical,  up  to  date  central 
bureau  of  information. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  BRAZIL, 
CARLOS  CESAR  DE  OEIVEIRA  SAMPAIO, 

Chairman. 
OSCAR  T.  CROSBY,  Vice  Chairman. 


CHILE. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable   the   SECRETARY  or  THE  TREASURY  OF  THE  UNITED 

STATES. 

SIR:  On  behalf  of  the  Chilean  group  committee,  we  beg  to  an- 
nounce that  after  several  well-attended  conferences  and  after  full 
discussion  of  the  topics  involved,  it  was  agreed  to  submit  the  follow- 
ing report  to  the  Second  Pan  American  Financial  Conference : 

DOCUMENTS   PRESENTED   BY   CHILEAN   DELEGATION. 

The  conference  group  had  the  advantage  of  receiving  from  the 
Chilean  delegation  a  number  of  carefully  prepared  reports  covering 
fully  almost  all  the  topics  included  in  the  preliminary  program  placed 
before  the  group.  These  documents  are  as  follows : 

I.  Monetary  system. 

II.  Taxation:  Custom  duties,  national  taxes,  local  taxes,  annual 
report  of  the  treasury,  external  debt,  internal  debt,  currency. 

III.  Banking  system.    Banking  facilities. 

IV.  Bills  of  exchange  and  checks.    Comparison  of  Chile's  commer- 
cial code  and  The  Hague  conventions. 

V.  Patents  and  trade-marks. 

VI.  Customs  and  commercial  statistics. 

VII.  Land  transaction. 

VIII.  Maritime  transportation. 

There  was  furthermore  delivered  before  the  conference  an  address 
by  Dr.  Victor  V.  Robles,  a  member  of  the  Chilean  delegation,  who 
gave  a  short  description  of  the  effect  of  the  war  on  the  general  in- 
dustrial and  agricultural  conditions  of  Civile. 

NITRATE  SITUATION. 

The  committee  wishes  to  call  particular  attention  to  the  fact  that 
in  some  of  the  documents  submitted  to  the  committee,  the  statement 
has  been  made  that  the  nitrate  industry  had  collapsed  as  a  result  of 
the  armistice.  While  it  is  true  that  temporarily  this  industry  was 

88 


REPORT    OF    THE    CONFERENCE    COMMITTEE—  CHILE.  89 

affected,  it  ought  to  be  stated  with  great  emphasis  that  conditions 
have  since  assumed  a  more  normal  status  and  that  the  nitrate  situa- 
tion has  now  recovered  its  usual  activity. 

Dealing  more  specifically  with  some  of  the  topics  treated  in  the  De- 
ports submitted  by  the  Chilean  delegation,  the  conference  group  begs 
leave  to  offer  the  following  observations. 

BANKING  AND  CURRENCY. 

The  Avar  has  brought  about  very  drastic  changes  in  the  financial 
conditions  of  both  Chile  and  the  United  States.  It  has  greatly 
strengthened  relations  that  exist  between  the  two  countries  in  finance 
and  commerce,  and  it  is  safe  to  predict  that  each  will  rely  upon  the 
other  in  the  future  to  a  much  vaster  extent  than  in  the  past.  At 
present  Chile  is  in  a  position  where  she  can  safely  consider  the  adop- 
tion of  a  gold  standard  and  the  Chilean  Government  has  already 
evolved  a  plan  to  this  effect,  including  the  establishment  of  a  central 
banking  system,  fashioned  along  the  same  lines  as  the  Federal  Re- 
serve System  of  the  United  States.  The  committee  heartily  indorses 
these  plans  and  hopes  sincerely  that  it  may  be  possible  to  bring  them 
to  an  early  realization.  It  is  with  particular  gratification  that  the 
committee  takes  notice  of  the  plan  of  the  Chilean  people  to  adopt  a 
gold  standard  which,  in  accordance  with  the  recommendations  of  the 
International  High  Commission  of  1916,  will  be  a  multiple  of  a  coin 
containing  0.33437  gram  of  gold,  and  being  0.900  fine,  the  latter  being 
approximately  20  cents  of  the  United  States  dollar.  The  stability 
of  the  Chilean  exchange  which  will  follow  the  adoption  of  the  con- 
templated central  banking  system,  with  a  definite  gold  standard,  will 
greatly  facilitate  the  further  development  of  commercial  and  financial 
relations,  the  growth  of  which  is  so  earnestly  desired  by  both 
countries. 

The  committee  believes  that  coming  years  will  show  a  growing 
intimacy  between  the  banking  systems  of  the  two  countries.  The  ac- 
ceptances available  through  North  American  banks  for  the  purpose 
of  financing  the  increasing  trade  ought  to  play  a  highly  important 
part  in  this  respect.  Moreover,  it  is  hoped  that  when  the  period  of 
readjustment,  in  which  all  nations  now  find  themselves,  has  passed,  the 
United  States  will  offer  a  constantly  widening  market  for  the  secur- 
ities of  American  countries.  There  is  all  the  more  reason  to  expect 
such  a  course  on  account  of  the  fact  that  not  only  has  the  United 
States  become  a  creditor  nation  as  a  consequence  of  the  war  but  also 
that  European  countries,  formerly  taking  a  leading  part  in  the  de- 
velopment of  this  hemisphere,  will  find  an  important  field  of  activity 
in  the  Old  World,  where  their  work  of  construction  and  reconstruc- 
tion will  have  a  first  claim  on  their  energies  and  attention. 


90  SECOND   PAN   AMERICAN    FINANCIAL,   CONFERENCE. 

LATIN-AMERICAN    BANKS    IN    THE    UNITED    STATES. 

It  is  important,  however,  for  the  purpose  of  further  strengthening 
the  bonds  uniting  the  Americas  that  not  only  North  American  banks 
go  into  South  American  and  Central  American  countries,  but  also 
that  steps  be  taken  enabling  Latin- American  banks  to  open  branches 
in  the  United  States.  Efforts  should  be  made  along  these  lines,  and 
the  committee  recommends  that  laws  be  enacted  in  the  leading  States 
of  the  North  American  Union  allowing  the  important  Latin- Ameri- 
can banks  to  open  branches  in  the  United  States  in  a  similar  manner 
as  North  American  banks  open  in  Latin- American  countries. 

RECOMMENDATIONS   TO  FOREIGN  BANKS  OPERATING  IN   CHILE. 

The  Chilean  delegation  submits  the  following  recommendations 
affecting  the  methods  of  operation  of  foreign  banks  in  Chile,  which 
this  committee  approves : 

(a)  That  foreign  banks  in  Chile  when  making  loans  endeavor  to 
do  so  through  the  medium  of  direct  obligations  with  fixed  maturities 
rather  than  through  overdraft  in  current  account  running  for  an 
indefinite  period. 

(b)  With  respect  to  credit  information  the  Chilean  delegates  have 
suggested  that  a  frank  exchange  of  information  be  had  between  the 
banks  of  both  countries. 


EQUAL  TREATMENT  FOR  DOLLAR  AND  POUND   STERLING. 

The  American  members  of  the  Chilean  group  pointed  to  the  fact 
that  the  laws  of  Chile  give  to  the  pound  sterling  the  privilege  of 
being  accepted  as  legal  tender,  and  the  committee  therefore  sug- 
gests that,  in  view  of  present  conditions  and  in  order  to  facilitate 
the  development  of  commercial  and  financial  relations,  the  dollar  be 
endowed  with  the  same  privilege  as  is  now  accorded  to  the  pound 
sterling. 

The  committee  further  recommends  that  dollar  exchange  be  quoted 
officially  on  the  stock  exchange  of  Santiago  and  Valparaiso  in  the 
same  manner  as  the  pound  sterling.  The  delegates  from  Chile, 
agreeing  to  this  recommendation,  promised  to  transmit  it  to  the 
boards  of  said  institutions  with  a  view  to  securing  favorable  action 
upon  the  request. 

TRANSPORTATION. 

The  effect  of  the  war  on  transportation  facilities  and  the  require- 
ments of  the  present  and  immediate  future  were  fully  discussed  by 
the  general  committee  on  this  topic.  Its  views  were  conveyed  to  the 


REPORT   OF   THE    CONFERENCE    COMMITTEE CHILE.  91 

Transportation  Committee  by  two  delegates  duly  appointed.  The 
report  on  transportation  will  be  made  to  you  by  the  Transportation 
Committee. 

PUBLIC    UTILITIES. 

Your  committee  has  considered  what  may  be  done  in  order  to  en- 
courage the  flow  of  capital  into  Chile  for  the  purpose  of  developing 
public  utilities  and  similar  projects. 

It  has  been  stated  that  existing  laws,  especially  in  relation  to  the 
installation  and  distribution  of  electric  power,  because  of  the  short 
life  allowed  for  such  franchises,  do  not  encourage  the  fullest  possible 
development  of  those  industries  which  necessitate  large  investments 
of  money.  The  Chilean  delegation  agreed  to  this  statement,  and  to 
the  desirability  of  the  modification  of  the  existing  laws. 

It  was  resolved,  therefore,  that  the  modification  of  the  Chilean  leg- 
islation on  public  utilities,  especially  hydroelectric  and  electric  de- 
velopments, should  be  secured,  so  that  franchises  would  provide  for  a 
life  of  approximately  80  years  before  installations  constructed  by  pri- 
vate enterprise  would  revert  to  the  Government. 


IMPORT  ASSOCIATIONS. 


Present  American  laws  have  provided  measures  permitting  Ameri- 
can exporters  to  organize  for  the  general  protection  of  the  interests 
of  the  United  States. 

Present  laws  do  not  provide,  however,  a  like  protection  for  im- 
porters, inasmuch  as  they  are  not  permitted  to  combine  for  similar 
purposes. 

It  is  therefore  recommended  that  American  industrial  enterprises 
producing  abroad  raw  materials  essential  for  the  industries  of  the 
United  States  be  allowed  under  proper  governmental  regulations  to 
join  organizations  formed  to  promote  the  production  of  such  raw 
materials,  and  it  is  further  recommended  that  the  Webb  law  be  so 
amended  as  to  permit  the  entrance  of  American  companies  into  such 
associations. 

It  is  likewise  recommended  that  the  Xitrate  Producers'  Association 
of  Chile  establish  a  committee  in  New  York  similar  to  those  now  ex- 
isting in  London  and  Berlin. 

ARBITRATION   OF   COMMERCIAL   DISPUTES. 

As  a  result  of  recommendations  made  by  Pan  American  and  Inter- 
national High  Commission  conferences,  arrangements  have  been  per- 
fected between  chambers  of  commerce  of  three  Latin- American  coun- 
tries and  the  United  States,  providing  a  machinery  for  the  arbitra- 
tion and  settlement  of  commercial  disputes. 


92  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

Since  their  organization  these  arbitration  committees  have  ren- 
dered excellent  services,  and  the  committee  strongly  urges  that  prompt 
steps  be  taken  to  perfect  similar  arrangements  between  the  United 
States  and  Chile. 

It  is  considered  advisable  that  in  contracts  for  the  purchase  or  sale 
of  goods  between  the  countries  involved  there  be  embodied  a  clause 
providing  for  such  arbitration  of  any  disputes  arising  with  respect  to 
the  quality  of  the  goods  or  the  general  fulfillment  of  the  terms  of  the 
contract.  Costly  controversies  involving  loss  of  time  and  money  may 
thus  be  avoided. 

PAN   AMERICAN   HIGH   COURT  OF  EQUITY. 

A  member  of  this  committee,  Mr.  John  Hays  Hammond,  has  sug- 
gested the  idea  of  creating  a  Pan  American  high  court  of  equity  to 
settle  commercial  disputes.  The  plan  contemplates  that  this  court 
should  hear  and  determine  cases  involving  solely  commercial  and 
financial  international  relations  between  Pan  American  nations.  The 
court  is  to  be  composed  of  judges  selected  by  and  representing  the 
various  Pan  American  countries. 

The  committee  voted  to  indorse  the  suggestion,  to  present  it  to  the 
Committee  on  Resolutions,  believing  that  such  court,  if  established, 
would  prove  a  contributing  factor  in  removing  some  of  the  obstacles 
that  may  stand  in  the  way  of  a  free  flow  of  capital  into  Latin  Ameri- 
can countries. 

A  careful  study  of  the  economic  problems  of  Chile  and  the  United 
States  has  not  failed  to  impress  anew  the  minds  of  the  members  of 
this  committee  that  as  a  matter  of  geography,  of  logic,  and  sentiment 
the  two  countries  are  destined  to  be  drawn  into  a  union  of  constantly 
growing  importance  and  intimacy.  The  Panama  Canal  has  opened 
the  door  between  them,  and  even  without  any  special  efforts  the  natu- 
ral evolution  will  be  in  this  direction.  If,  however,  the  present  con- 
ference and  its  recommendations  should  succeed  in  promoting  and 
accelerating  this  propitious  course,  it  will  be  a  particular  gratifica- 
tion to  the  signers  of  this  report. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  CHILE, 

Luis  IZQUIERDO,  Chairman. 

PAUL  M.  WARBURG,  Vice  Chairman. 


COLOMB  A. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the  SECRETARY  or  THE  TREASURY  OF  THE  UNITED 
STATES. 

SIR:  The  group  conference  committee  for  Colombia,  consisting  of 
the  delegates  from  that  Republic  and  the  members  from  the  United 
States,  has  made  a  careful  study  of  the  topics  that  were  submitted 
for  its  guidance  and  consideration  and  begs  to  present  the  following 
report  of  its  deliberations  on  those  points  that  were  deemed  of 
especial  interest  to  Colombia  and  the  United  States : 

As  a  result  of  the  European  war  Colombia  has  become  more  self- 
sustaining.  It  now  produces  various  foodstuffs  that  formerly  had  to 
be  imported  in  order  to  supply  the  domestic  needs  of  the  country  and 
is  exporting  some  of  these  products  to  neighboring  countries.  Stimu- 
lus also  has  been  given  to  the  growth  of  manufacturing,  especially  in 
the  line  of  coarse  textiles. 

While  there  was  a  noticeable  shrinkage  in  the  revenues  of  the 
Colombian  Government  during  the  period  of  the  war,  on  account  of 
the  decline  of  imports,  upon  which  duties  that  constitute  the  princi- 
pal source  of  revenue  were  levied,  the  financial  position  of  the  Re- 
public has  been  in  no  way  impaired.  On  the  contrary,  Colombia 
stands  forth  as  one  of  the  American  countries  whose  financial  sound- 
ness and  integrity  are  beyond  question.  All  obligations  have  been 
promptly  met,  and  there  is  only  praise  to  be  accorded  to  those  who 
have  been  in  charge  of  the  nation's  finances. 

On  account  of  the  low  rate  of  foreign  exchange  in  Colombia  prac- 
tically all  of  the  gold  produced  by  its  mines  has  remained  in  the 
country  and  is  being  minted  there,  increasing  thus  the  amount  of 
gold  in  circulation.  There  has  been  a  steadily  growing  production  in 
practically  all  lines  in  Colombia,  and  the  country  is  more  prosperous 
on  account  of  the  higher  prices  received  for  its  commodities. 

Capital  is  needed,  however,  for  the  enlargement  and  completion  of 
certain  important  public  projects,  in  order  that  the  Republic  may 
develop  to  the  best  advantage  its  rich  natural  resources  and  foreign 
trade.  The  Government  of  Colombia  is  particularly  interested  at 
present  in  three  classes  of  public  construction  enterprises:  (1)  The 
improvement  of  port  facilities;  (2)  the  building  of  railways;  and 

93 


9  I  SECOND   PAN   AMERICAN    FINANCIAL   CONFERENCE. 

(3)  the  extension  of  sewerage,  paving,  and  waterworks  in  some  of 
the  larger  cities. 

In  regard  to  railways,  the  Government  of  Colombia  wishes  to  con- 
fine its  efforts  at  present  to  extending  a  line  northward  from  Bogota, 
the  capital,  to  the  head  of  deep-water  navigation  on  the  Magdalena 
River,  and  completing  the  Pacific  Railway,  which  is  to  .connect 
Bogota  with  the  port  of  Buenaventura.  Of  the  latter  road,  400  kilo- 
meters have  already  been  constructed,  leaving  approximately  only 
300  kilometers  to  be  built.  The  Government  is  ready  to  offer  the  most 
ample  security  to  investors  who  may  undertake  the  financing  of  these 
projects,  pledging,  in  addition  to  the  mileage  constructed,  a  proper 
guarantee  from  some  portion  of  the  national  revenues.  It  is  the  idea 
of  the  Government  to  carry  out  this  work  of  railway  building  gradu- 
ally, as  circumstances  may  permit,  and  in  accordance  with  the 
policy  that  has  made  the  financial  standing  of  Colombia  so  secure. 

There  is  sufficient  local  capital  for  the  promotion  of  relatively 
small  enterprises,  but  not  for  larger  undertakings,  such  as  railway 
construction,  public  works,  and  the  development  of  petroleum  lands 
and  mines.  Until  recently  only  people  of  large  means  were  able  to 
share  in  the  ownership  of  Colombian  enterprises.  Xow,  through  the 
issuance  of  capital  shares  in  small  denominations,  opportunities  are 
opened  to  small  investors  and  advantage  is  being  taken  of  them. 

Since  the  Pan  American  Financial  Conference  of  1915,  banking 
facilities  in  Colombia  have  largely  increased.  The  country's  own 
banks  have  added  very  materially  to  their  resources.  Three  large 
Xorth  American  banks  also  have  entered  the  field  with  branches  in 
the  principal  commercial  centers.  All  these  have  prospered.  There 
is  undoubtedly  room  for  still  further  activities  in  this  line  of  business. 

The  attention  of  the  committee  has  been  directed  to  certain  desir- 
able changes  in  banking  methods  for  the  facilitation  of  trade  and 
commerce  between  Colombia  and  the  United  States.  Chief  among 
these  is  the  wider  use  of  bank  acceptances  as  embodied  in  the  recom- 
mendations at  the  close  of  this  report.  Work  should  be  done  to 
arouse  general  interest  in  this  respect,  so  as  further  to  encourage  the 
development  of  commerce. 

Private  investment  will  find  a  wide  field  in  Colombia.  The  Re- 
public is  a  country  of  great  agricultural  possibilities.  It  possesses 
immense  areas  suitable  for  grazing,  conveniently  situated  with  ref- 
erence to  the  sea  and  navigable  rivers.  Up  to  the  present  time  it  has 
been  possible  to  export  only  a  small  number  of  cattle  on  the  hoof, 
principally  to  the  Canal  Zone.  But  with  the  completion  of  packing 
houses,  one  under  construction  and  one  in  prospect,  Colombia  will  be 
in  a  position  to  supply  the  market  for  canned  and  refrigerated  meats, 
both  in  Europe  and  America.  A  number  of  foreign  interests  are 


REPORT   OF   THE    CONFERENCE    COMMITTEE COLOMBIA.  95 

now  acquiring  lands  for  cattle  raising  and  for  sheep  raising  in  the 
mountain  districts.  There  are  many  regions  in  Colombia  suitable 
for  the  cultivation  of  sugar  cane.  One  large  cane-sugar  mill  (cen- 
tral) and  several  smaller  ones  are  in  operation,  producing  sufficient 
sugar  for  domestic  consumption.  In  addition,  excellent  opportunities 
exist  for  those  who  will  engage  in  this  industry  for  export  purposes. 
Foreign  capital  will  find  favorable  employment  in  the  development 
of  Colombia's  petroleum  resources.  Much  activity  is  visible  in  this 
connection,  options  having  been  taken  on  approximately  900,000  hec- 
tares (1  hectare  —  2-J  acres  of  land).  The  Colombian  Government 
also  grants  concessions  on  public  lands.  These  three  industries  are 
perhaps  the  most  important  as  far  as  new  opportunities  are  con- 
cerned, but  there  are  many  other  fields  in  which  foreign  capital  may 
profitably  engage.  Colombia  is  the  largest  producer  of  mild  grades 
of  coffee.  It  is  second  only  to  Russia  in  the  production  of  platinum. 
It  is  the  sole  producer  of  the  finer  sort  of  emeralds.  Its  coal  deposits 
are  quite  rich.  Colombia  is  an  important  exporter  of  hides,  vege- 
table ivory,  tobacco,  rubber,  bananas,  and  other  tropical  fruits.  On 
the  basis  of  present  production  great  possibilities  also  are  offered  for 
the  cultivation  of  long-staple  cotton. 

The  national  debt  of  Colombia  is  almost  negligible,  amounting  to 
only  about  $3.50  per  capita.  The  fiscal  system  is  now  in  process  of 
reorganization.  Custom  duties  hitherto  have  constituted  the  chief 
source  of  revenue,  but  direct  taxes  are  now  beginning  to  be  levied. 
The  first  income-tax  act  of  the  Eepublic  has  gone  into  effect  in  the 
present  year.  The  Government  expects  that  the  old  system  of  taxa- 
tion will  soon  be  revised  throughout  in  accordance  with  modern 
ideas. 

Colombia  is  now  on  a  gold  basis.  Exchange  on  the  United  States 
stands  at  par,  or  in  favor  of  Colombia.  Taxes  are  levied  by  the 
national,  departmental,  and  municipal  governments.  They  are  un- 
usually low.  that  imposed  on  real  estate,  for  instance,  being  $2  per 
thousand.  The  total  per  capita  tax  rate  of  the  Eepublic  amounts 
to  about  $6  per  annum. 

One  of  the  results  of  the  war  was  to  reduce  the  number  of  steam- 
ship lines  operating  to  and  from  European  ports,  as  well  as  those  of 
the  United  States.  The  service  of  the  ships  upon  which  Colombia 
has  to  depend  is  such  as  to  make  travel  far  less  attractive  than  it 
should  be  in  the  mutual  interest  of  both  Colombia  and  the  United 
States.  It  must  be  borne  in  rnind  that  European  steamship  lines  for- 
merly plying  to  and  from  Colombia  are  planning  to  reestablish  their 
service  in  the  immediate  future.  What  is  needed,  therefore,  is  faster, 
more  frequent,  and  better  service  between  Colombia  and  the  United 
States.  Unless  this  is  forthcoming,  there  is  danger  that  this  country 


96  SECOND   PAN    AMERICAN    FINANCIAL   CONFERENCE. 

will  lose  much  of  the  trade  that  it  gained  during  the  war,  which  it  can 
and  should  hold. 

The  Government  of  Colombia  is  taking  an  active  interest  in  the 
removal  of  obstacles  to  navigation  and  deserves  commendation  for  the 
excellent  progress  that  it  is  making  in  this  direction. 

In  view  of  the  approaching  resumption  of  service  to  Colombia  by 
European  steamship  lines,  the  committee  would  also  call  attention  to 
the  fact  that  such  lines  will  carry  freight  (as  they  have  in  the  past)  to 
European  ports,  approximately  twice  the  distance  from  Colombia  to 
American  ports,  at  substantially  the  same  freight  rates  as  those 
charged  by  American  vessels  to  and  from  the  United  States.  It  sug- 
'gests,  therefore,  the  advisability  of  promptly  establishing  as  low 
rates  as  possible  in  order  that  this  European  competition  may  be  met 
before  the  trade  shall  have  been  lost. 

It  is  gratifying  to  note  that  the  regulations  governing  commercial 
intercourse  between  the  United  States  and  Colombia  show  a  marked 
spirit  of  fairness.  Taxes  on  commercial  travelers  and  their  samples 
are  nominal,  and  no  difficulties  are  placed  in  the  way  of  salesmen's 
activities. 

Plans  for  the  improvement  of  cable  and  telegraph  service,  as  well 
as  for  the  introduction  of  the  Marconi  wireless  system,  are  being 
worked  out,  and  the  committee  is  informed  that  satisfactory  progress 
is  being  made.  When  this  work  shall  have  been  completed  Colombia 
expects  to  have  prompt  and  reliable  domestic  and  foreign  communi- 
cation. 

Colombia  is  improving  its  warehouse  facilities  in  the  principal 
ports,  and  the  Government  is  taking  great  interest  in  the  further  bet- 
terment of  these  important  aids  to  commerce. 

Since  payment  by  check  was  until  recently  unknown  in  Colombia, 
the  law  had  not  taken  cognizance  of  the  practice;  but  an  act  has 
now  been  passed,  as  a  result  of  which  it  is  hoped  that  the  check  sys- 
tem will  become  widely  adopted. 

Colombia,  finally,  is  one  of  the  countries  of  America  which  has 
laws  affording  adequate  protection  to  the  rightful  owners  of  patents, 
trade-marks,  and  copyrights. 

In  conclusion,  the  committee  desires  to  submit  the  following  recom- 
mendations : 

1.  That  the  attention  of  the  various  ministries  of  Colombia  be 
called  to^  the  desirability  of  publishing  descriptive  pamphlets  in 
English  for  distribution  in  the  United  States.  Such  pamphlets 
should  contain  detailed  and  trustworthy  information  in  regard  to 
petroleum  and  ore  deposits  and  such  industries  as  cattle  raising, 
sugar,  cotton,  etc.  They  should  include  a  brief  statement  of  the 
laws  covering  the  development  of  mines  and  petroleum  in  prder  that 


REPORT  OF  THE   CONFERENCE   COMMITTEE COLOMBIA.  97 

capitalists  in  the  United  States  having  money  to  invest  in  such  enter- 
prises may  know  under  what  conditions  investments  may  be  made 
and  safeguarded. 

2.  That  the  International  High  Commission  continue  its  study 
of  the  possibility  of  establishing  an  international  gold  clearance 
fund. 

3.  That  a  Pan-American  postal  congress  be  called  to  frame  a  con- 
vention supplementing  the  postal  convention  of  Montevideo  so  as 
to  facilitate  postal  interchange  between  the  Latin  American  Repub- 
lics and  the  United  States  and  to  consider  changes  brought  about  by 
modern  means  of  communication. 

4.  That  those  Latin- American  countries  which  have  not  yet  adopted 
the  recommendations  of  The  Hague  Conference  of  1912  in  regard  to 
bills  of  exchange,  checks,  etc.,  be  urged  to  do  so. 

5.  That  the  delegates  from  Colombia  bring  to  the  attention  of 
their  Government  the  advisability  of  modifying  the  laws  governing 
the  shipment  of  merchandise  to  that  country  so  as  to  permit  con- 
signment of  goods  to  order  and  legalize  warehouse  receipts. 

6.  That  measures  be  taken,  through  the  medium  of  the  Chamber  of 
Commerce  of  the  United  States  and  the  Colombian  chambers  of  com- 
merce, for  the  arbitration  of  any  commercial  disputes  between  citi- 
zens of  Coldmbia  and  those  of  the  United  States. 

7.  It  is  deemed  desirable  to  add  to  these  recommendations  those 
already  submitted  to  the  Transportation  Committee,  viz : 

(a)  For  th*e  betterment  of  steamship  service  between  the  United 
States  and  Colombia,  it  would  be  desirable,  first,  to  have  American 
steamship  lines  now  plying  to  Cuba  and  Porto  Kico  extend  their 
service  to  the  Atlantic  ports  of  Colombia ;  second,  to  have  American 
vessels  now  serving  such  ports  proceed  to  them  directly,  instead  of 
indirectly  by  way  of  other  ports  on  the  Caribbean;  and,  third,  to 
have  American  ships  now  passing  through  the  Panama  Canal,  to 
and  from  the  west  coast  of  South  America,  call  at  Buenaventura,  the 
chief  port  of  Colombia  on  the  Pacific. 

(b)  For  the  further  promotion  of  oceanic  traffic,  measures  should 
be  taken  to  remove  the  sand  bar,  known  as  Bocas  de  Ceniza,  at  the 
mouth  of  the  Magdalena  River,  and  carry  on  such  additional  dredg- 
ing as  may  be  required  to  render  it  possible  for  ocean-going  vessels 
to  proceed  directly  up  the  river  to  Barranquilla,  thus  obviating  the 
present  necessity  of  transshipment  from  steamer  to  railway  at  Puerto 
Colombia. 

(c)  In  view,  also,  of  the  rapidly  growing  resumption  of  service  by 
European  steamship  lines  which  carry  freight  to  European  ports,  ap- 
proximately twice  the  distance  from  Colombia  to  American  ports,  at 
substantially  the  same  freight  rates  as  those  now  charged  by  Ameri- 

14970—21 7 


98  SECOND  PAN   AMERICAN   FINANCIAL  CONFERENCE. 

can  vessels  for  the  conveyance  of  merchandise  to  and  from  the  United 
States,  it  is  desirable,  in  the  interests  of  the  trade  between  Colombia 
and  the  United  States,  that  the  freight  rates  be  placed  on  as  lew  a 
basis  as  possible. 

(d)  In  the  interest  of  transportation  within  the  interior  of  Colom- 
bia, it  would  be  desirable  to  unite  the  capital  city  by  rail  with  the 
Atlantic  and  Pacific  coasts  through  the  extension  of  a  railway  north- 
ward from  Bogota  to  the  most  suitable  point  on  the  lower  Magdalena 
River  and  through  completion  of  the  Pacific  Railway.  This  work  of 
extension,  it  is  gratifying  to  note,  will  be  carried  on  by  the  Colombian 
Government  gradually,  as  circumstances  may  permit,  and  in  a  man- 
ner that  will  insure  the  maintenance  of  the  policy  which  has  made 
the  financial  standing  of  Colombia  secure. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  COLOMBIA, 
POMPONIO  GUZMAN,  Chairman. 
WALLACE  D.  SIMMONS,  Vice  Chairman. 


CUBA. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  or  THE  TREASURY  OF  THE  UNITED 
STATES. 

SIR:  An  able  and  comprehensive  memorandum  of  the  secretary  of 
finance  of  Cuba,  especially  prepared  for  this  conference,  furnished 
the  principal  basis  for  the  discussions  at  the  meetings  of  the  Cuban 
committee. 

The  prosperous  condition  of  the  island,  vividly  shown  by  the 
memorandum,  and  the  growth  of  her  trade  with  the  United  States 
of  America  furnish  a  happy  example  of  the  mutual  benefits  which 
accrue  from  the  close  economic  cooperation  between  the  United 
States  of  America  and  the  Latin- American  countries. 

The  problems  confronting  Cuba  are  strikingly  different  from 
those  of  the  majority  of  the  South  American  and  Central  American 
countries.  This  is  so  for  several  reasons,  among  which  may  be 
mentioned : 

First.  The  geographical  situation  of  Cuba  is  such  that  her  rail- 
ways may  be  considered,  from  a  physical  point  of  view,  as  a  part  of 
the  railway  system  of  the  United  States  of  America,  being  separated 
by  only  90  miles  of  water,  traversed  by  ferryboats  in  six  hours.  In 
addition  there  are  long-established  steamship  lines  connecting  the 
principal  ports  of  Cuba.  The  transportation  problem,  of  such  vital 
importance  to  so  many  of  the  countries  represented  at  this  confer- 
ence, is  limited,  in  so  far  as  Cuba  is  concerned,  to  the  relatively 
insignificant  question  of  providing  better  accommodations  and  facili- 
ties by  the  adjustment  and  speeding  up  of  railroad  and  boat  sched- 
ules and  otherwise  for  furthering  the  convenience  of  the  ever- 
increasing  hosts  of  tourists  and  travelers.  Problems  in  regard  to 
cables,  postal  service,  wireless  and  air  communication  have  almost 
completely  disappeared. 

Second.  In  addition  to  the  intimate  physical  connection,  Cuban 
political  and  financial  relations  with  the  United  States  of  America 
are  closer  than  those  existing  between  the  United  States  and  the 
other  countries  of  America.  The  fact  that  her  coinage  is  based  on 
the  gold  standard  of  the  United  States  of  America,  whose  currency 

99 


100  SECOND  PAN   AMERICAN   FINANCIAL  CONFERENCE. 

circulates  and  is  legal  tender  in  Cuba,  reduces  the  economic  problems 
to  a  minimum— a  far  different  situation  from  that  which  exists  be- 
tween the  United  States  and  the  adjacent  countries  of  Mexico  and 
Canada  or  between  adjacent  countries  on  the  South  American  Conti- 

The  relations  between  the  banking  system  of  Cuba  and  that  of  the 
United  States  are  unusually  intimate.  Cuban  banks,  with  their  innu- 
merable branches  throughout  the  island,  are  closely  linked  with  banks 
in  the  United  States  and  Canada,  either  by  ownership,  affiliation,  or 
long-established  daily  business  contact.  In  addition,  important  bank- 
ing and  brokerage  firms  in  Habana  keep  in  constant  touch  with  the 
New  York  Stock  Exchange  in  exactly  the  same  manner  as  do  similar 
houses  in  the  leading  cities  of  the  United  States.  The  very  rapid 
growth  of  banking  in  Cuba  has  scarcely  given  time  to  work  up  such 
close  coordination  between  the  different  banks  as  might  perhaps  be 
desirable,  but  it  is  only  a  question  of  time  when  clearing  houses  will 
be  established  and  the  banks  all  found  working  together  for  the 

general  good. 

Third.  The  complementary  relations  between  the  products  of 
Cuba  and  those  of  the  United  States  combine  with  the  geographical 
situation  to  make  the  latter  country  the  greatest  market  for  Cuban 
products  and  Cuba  a  most  favorable  export  market  for  the  United 
States.  Iji  1918  about  TO  per  cent  of  Cuba's  exports  went  to  the 
United  States,  from  which  she  bought  72  per  cent  of  her  imports. 
These  percentages  were  undoubtedly  increased  in  1919,  the  statistics 
for  which  are  not  yet  available.  These  figures  indicate  that  Cuban 
agricultural  and  mineral  output  is  needed  in  the  United  States,  and, 
conversely,  the  agricultural  and  manufactured  articles  of  the  United 
States  are  needed  by  Cuba.  This  fortunate  situation,  being  natural 
and  not  artificial,  is  bound  to  endure  and  augurs  well  for  the  con- 
tinued commercial  relations  between  the  two  countries. 

Financially,  Cuba  has  prospered  during  the  Great  War.  For  the 
years  1916,  1917,  and  1918  her  favorable  balances  of  trade  were 
$106,000,000,  $100,000,000,  and  $113,000,000,  respectively,  while  that 
of  1919  (the  statistics  of  which  have  not  yet  been  compiled)  is  esti- 
mated at  $200,000,000,  and  for  1920  might  even  reach  $300,000,000. 
In  the  invisible  balance,  expenditures  by  American  tourists  help  to 
offset  the  interests  Cuba  has  to  make.  Although  many  of  the  sugar 
mills  in  Cuba  are  owned  by  American  and  English  interests,  the  cane 
plantations,  or  "  colonias "  themselves,  are  chiefly  owned  or  leased 
by  Cubans ;  and  the  indication  in  the  figures  just  given  of  great  pros- 
perity for  Cuba  is  borne  out  by  fact.  This  is  shown  not  only  by  the 
large  increase  in  banking  deposits  but  also  in  the  greatly  enhanced 
value  of  land  in  both  cities  and  country,  as  well  as  by  the  construe- 


REPORT   OF  THE   CONFERENCE   COMMITTEE — CUBA.  101 

tion  of  buildings,  highways,  railways,  and  other  public  and  private 
works.     More  perhaps  than  other  countries  of  South  and  Central 
America  will  Cuba  have  the  means  to  continue  the  development  of 
her  agricultural  and  mineral  resources,  although  it  may  take  time 
and  effort  to  divert  her  capital  more  fully  in  this  direction.    Perhaps 
the  ideal  method  of  development  will  be  the  association  of  Cuban 
capital  and  knowledge  of  local  conditions  with  American  investment, 
experience  and  knowledge  of  construction,  engineering,  and  tech- 
nical problems  in  general.    Further,  it  is  not  unreasonable  to  suppose, 
in  view  of  her  trade  balance,  large  surplus  profits,  and  the  fact  that 
she  is  buying  back  her  own  securities  that  Cuba  may  even  figure  as  a 
creditor  nation  and  be  in  a  position,  after  providing  fully  for  her 
own  requirement,  to  furnish  credit  to  the  outside  world.    Her  bank- 
ers now  have  a  certain  clientele,  for  whom  they  deal  in  non-Cuban 
investments,  including  on  a  large  scale  United  States  Liberty  bonds, 
and  it  would  not  seem  difficult  for  them  to  build  up,  in  connection 
with  those  in  the  United  States  who  have  had  long  experience  in 
such  lines,  the  necessary  machinery  for  the  sale  and  distribution  of 
securities.    The  necessity  for  inculcating  habits  of  thrift  among  her 
people,  and,  as  shown  by  the  memorandum  of  the  secretary  of  finance, 
for  curbing  undue  speculation  on  the  one  hand  and  teaching  the  prin- 
ciples of  sound  investment  on  the  other  has  been  appreciated  by  the 
Cubans  themselves. 

Another  fortunate  phase  of  Cuba's  recent  life  is  that  her  Govern- 
ment has  provided  in  her  budget  to  pay  ordinary  expenses  through 
taxation  instead  of  by  issuing  bonds  or  paper  money.  In  1917  there 
was  authorized  an  issue  of  $30,000,000  of  bonds  for  special  war  pur- 
poses, guaranteed  by  special  war  taxes,  of  which  $10,000,000  were 
taken  by  the  United  States  as  a  guarantee  for  a  loan.  The  budget 
for  1918-19  provided  revenues  of  $64,460,000  to  cover  expenditures  of 
$62,730,000.  Of  these  revenues  $37,000,000  came  from  custom  duties, 
$15,000,000  from  land  revenues,  and  $4,000,000  from  the  national  lot- 
tery. In  fact,  the  actual  revenues  exceeded  by  about  $6,000,000  the 
budget  figures.  The  services  of  the  public  debt  require  only  $6,000,- 
000  for  an  external  debt  of  $51,500,000  and  an  internal  debt  (includ- 
ing the  war  debt  above  mentioned  of  $30,000,000)  of  $47,000,000. 

Additional  statistics  might  be  presented  without  end,  all  demon- 
strating the  able  manner  in  which  Cuban  officials  and  private  in- 
dividuals have  met  the  problems  of  the  recent  trying  years  of  war. 
It  is  safe  to  assume  that  they  will  meet  with  equal  intelligence  the 
perplexing  questions  which  they,  together  with  the  countries  of  the 
world,  are  now  facing.  Her  chief  economic  problems,  as  suggested 
above,  are  due  not  to  poverty  but  to  a  plethora  of  wealth.  Wise  con- 
servation of  resources  to  act  as  a  reserve  in  future  times  when  condi- 


102  SECOND   PAN   AMERICAN   FINANCIAL  CONFERENCE. 

tions  may  not  be  as  highly  prosperous  as  to-day  may  confidently  be 
looked  forward  to. 

In  this  connection  it  is  worthy  to  note  that  as  Cuba's  prosperity 
depends  so  largely  on  sugar,  and  that  as  the  United  States  will  pro- 
vide a  market  for  only  two-thirds  of  the  present  enlarged  production 
(double  that  of  prewar  days),  other  markets  must  remain  open. 
The  services  that  Cuba  rendered  to  the  Allies  during  the  late  struggle 
should  not  be  forgotten.  Among  other  services,  at  their  behest,  she 
doubled  her  sugar  output  in  a  short  space  of  time,  with  scarcely  any 
increase  in  population.  The  enormous  sugar  output  in  proportion  to 
population  is  wrorthy  of  attention,  indicating  a  high  degree  of  effici- 
ency among  the  mill  owners  and  of  industry  among  the  cane  planters. 
-Cuba  promptly  accepted  price  regulations  for  1917-18  and  1918-19 
crops,  strained  her  credit  to  the  limit  to  plant  a  vast  area  of  land  in 
sugar  cane  and  her  present  prosperity  is  thus  largely  due  to  her 
initiative  and  industry.  Under  ordinary  conditions  Cuba  can  meet 
her  competitors  in  the  markets  of  the  world,  but  should  some  of  the 
European  countries,  in  order  to  help  pay  their  war  indemnities, 
revive  their  former  policy  of  paying  bounties  to  sugar  producers,  or 
unduly  aiding  them  in  any  way,  it  would  place  Cuba  and  the  other 
sugar-producing  countries  of  America  in  a  most  unfortunate  posi- 
tion, which  would  react  seriously  on  the  United  States. 

The  committee,  therefore,  desires  to  call  the  attention  of  the  com- 
mittee on  form  and  resolutions  to  this  matter  as  a  subject  for  con- 
sideration and  makes  the  following : 

RECOMMENDATIONS. 

I.  That  it  be  declared  to  be  the  sense  of  the  conference  that  the 
Governments  of  the  Pan  American  countries,  individually  and  col- 
lectively, should  take  proper  measures  to  forestall  attempts  to  in- 
troduce any  system  of  sugar  bounties,  subsidies,  or  other  artificial 
devices  which  would  in  substance  be  tantamount  to  unfair  competi- 
tion. 

II.  That  the  conference  urge  the  advisability  of  improving  tourist 
accommodations,  removing  as  speedily  as  possible  restrictions  upon 
travelers  and  taking  measures  generally  for  the  safety,  comfort,  and 
convenience  of  tourists  and  travelers. 

III.  That  Governments  and  corporations  contemplating  the  estab- 
lishment of  South  American  steamship  lines  be  urged  to  take  into 
consideration  the  advisability  of  making  Cuban  cities  ports  of  call 
in  view  of  the  port  facilities  and  extensive  commerce  of  the  Cuban 
Republic. 


REPORT   OF   THE    CONFERENCE    COMMITTEE CUBA.  103 

IV.  That  the  recommendations  of  the  Pan  American  Union  in  re- 
gard to  the  deposit  and  dissemination  of  official  information  be  ap- 
proved and  acted  upon. 

V.  The  committee  feels  confident  that  the  Chamber  of  Commerce, 
Industry,  and  Navigation  of  Cuba,  especially  in  view  of  the  fact  that 
arbitration  has  already  taken  place  under  its  rules,  will  be  glad  to 
cooperate  in  any  general  movement  for  the  furtherance  of  commer- 
cial arbitration,  and  recommends  that  it  be  approached  for  this  pur- 
pose. 

VI.  That  the  attention  of  American  exporters  and  manufacturers 
and  of  Cuban  importers  be  called  to  the  advisability  of  routing  mer- 
chandise to  Cuba  by  the  most  economical  lines. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  CUBA, 
CARLOS  MANUEL  DE  CESPEDES,  Chairman. 
MILTON  C.  ELLIOTT,  Acting  Vice  President. 


THE  DOMINICAN  REPUBLIC. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY   OF   THE   TREASURY   or  THE   UNITED 

STATES. 

SIR  :  Whereas  from  a  study  of  reports  and  material  concerning  the 
Dominican  Republic  furnished  the  Conference  Committee  for  ex- 
amination, and  from  information  supplied  by  the  official  delegation, 
it  has  been  established : 

(a)  That  the  financial  condition  of  the  Dominican  Republic,  as  a 
result  of  the  currency  reforms  and  fiscal  system  described  in  the  an- 
nexed report,  is  excellent,  and  that  the  finances  are  established  on  a 
sound  basis  which  will  permit  the  further  growth  and  development  of 
the  Republic. 

(b)  That  the  development  of  the  country  requires  that  the  Domini- 
can Government's  program  of  roads,  port  improvements,  and  other 
public  works  be  carried  through  to  a  conclusion,  and  that  the  negoti- 
ation of  a  loan  in  the  amount  of  $5,000,000,  to  be  secured  by  a  first 
lien  on  all  the  revenues  other  than  the  receipts  from  duties  upon  im- 
ports and  exports,  is  justified. 

(c)  That  the  adoption  of  the  proposal  of  the  Dominican  Govern- 
ment that  a  trade  agreement  of  a  reciprocal  nature  be  executed  be- 
tween the  Dominican  Government  and  the  United  States  along  the 
lines  proposed  by  it  would  be  of  material  assistance  to  both  countries 
in  the  development  of  their  trade. 

It  appears  that  certain  measures  should  be  taken  as  hereafter  enu- 
merated. 

MEASURES   WHICH  THE   DOMINICAN   REPUBLIC    SHOULD  TAKE. 

1.  The  abolition  of  tonnage  dues. 

2.  The  reduction  in  customs  tariff  and  liberal  treatment  for 

foodstuffs,  chemical  products,  pharmaceutical  products, 
manufactures  of  iron,  steel,  building  material,  etc. 

3.  The  abolition  of  export  duties  on  Dominican  products.   • 

MEASURES  WHICH  THE  UNITED  STATES  GOVERNMENT  SHOULD  TAKE. 

1.  The  admission  of  Dominican  sugar,  tobacco,  cigars,  cigar- 
ettes, cacao,  honey,  and  castor  beans,  and  other  Dominican 
exports  on  terms  equal  to  those  accorded  the  Republic  of 
Cuba. 

104 


CONFERENCE   COMMITTEE THE  DOMINICAN  REPUBLIC.        105 

It  appears  that  the  position  of  the  Dominican  .Republic,  geographi- 
cally near  to  the  United  States,  and  to  a  large  extent  economically  de- 
pendent upon  the  United  States,  and  the  grave  moijal  and  political 
responsibilities  of  the  United  States  toward  the  Republic,  entitle  this 
latter  to  the  concessions  requested : 

(d)  That  the  shipping  facilities  to  and  from  the  Dominican  Re- 
public are  quite  inadequate,  for  the  following  reasons : 

1.  The  passenger  steamers  employed  in  the  service  between 
the  United  States  and  the  Dominican  Republic  are  slow,  old, 
and  do  not  afford  suitable  accommodations  for  the  traveling 
public.     The  passenger  service  between  San  Pedro  de  Macoris 
and  New  York,  with  one  stop,  takes  an  average  of  10  or  11 
days,  as  compared  with  4J  days  between  New  York  and  San 
Juan,  P.  R.,  approximately  the  same  distance. 

2.  Direct  communication  between  New  York  and  Santo  Do- 
mingo depends  entirely  on  one  steamship  line,  and  freight  rates 
are  extremely  high  and  seemingly  based  on  the  maximum  that 
the  traffic  will  bear,  rather  than  upon  the  basis  of  a  reasonable 
profit  over  the  cost  of  operation.     This  operates  as  a  heavy 
handicap  upon  the  outgoing  and  incoming  freight  of  the  Domini- 
can Republic  as  compared  with  her  nearest  neighbors,  Cuba  and 
Porto  Rico. 

3.  An  express  service  from  Santo  Domingo  City  and  San 
Pedro  de  Macoris,  on  the  south  of  the  island,  direct  to  the 
port  of  New  York  would  facilitate  commerce  and  reduce  the 
time  required  for  the  voyage  between  the  said  ports  by  five 
days,  cutting  the  present  time  required  for  the  voyage  practi- 
cally in  half. 

4.  A  freight  and  passenger  service  from  the  port  of  New 
Orleans  to  Santo  Domingo  would  aid  the  introduction  and  dis- 
tribution of  American  products  and  manufactures  of  the  South- 
ern and  Middle  Western  sections  of  the  United  States  into  the 
Dominican   Republic,  with  profitable  return   freights   of   Do- 
minican products,  to  the  mutual  advantage  of  both  countries. 

5.  The  Dominican  Republic  is  revising  its  laws  relating  to 
shipping  and  ports  to  conform  to  the  best  modern  practice;  is 
engaged  upon  the  improvement  of  its  ports  and  port  facilities, 
including  the  deepening  of  its  southern  ports ;  and  tonnage  dues 
will  soon  be  removed :  Now,  therefore,  be  it  hereby 

Resolved,  (1)  That  this  committee  indorses  the  policy  heretofore 
and  at  present  pursued  in  establishing  currency  reform  and  a  fiscal 
system,  which  has  resulted  in  the  present  satisfactory  financial  con- 
dition of  the  Republic  and  which  will  permit  of  the  further  growth 
and  development  of  the  Republic's  resources ; 


106  SECOND  PAN   AMERICAN  .FINANCIAL,  CONFERENCE. 

(2)  That  this  committee  heartily  indorses  the  public  works  pro- 
gram of  the  Dominican  Government,  and  believes  that  the  loan  pro- 
posed by  the  sa^d  program  is  amply  justified  by  the  projects  and  by 
the  condition  of  the  revenues ; 

(3)  That  this  committee  is  of  the 'opinion  that  the  trade  agreement 
proposed  by  the  Dominican  Kepublic  would  be  of  mutual  benefit  to 
the  United  States  and  the  Dominican  Republic,  and  does  hereby 
recommend  it  to  the  favorable  consideration  of  the  United  States 
Government ; 

(4)  That  the  committee  finds  that  the  Dominican  Republic  is  tak- 
ing active  steps  to  provide  for  liberal  treatment  of  shipping  and  to 
aid  and  encourage  it  in  every  way;  that  it  is  the  belief  of  the  com- 
mittee that  the  Republic  is  justified  in  asking  for  better  steamship 
service  to  the  United  States.    The  committee  therefore  recommends 
that  the  Shipping  Board  include  in  its  program  the  provision  for  a 
proper  and  adequate  passenger  and  freight  service  from  New  York 
and  New  Orleans  with  reasonable  rates  as  compared  with  the  neigh- 
boring islands ;  and 

(5)  That  in  view  of  disagreements  arising  out  of  acceptance  or 
rejection  of  merchandise  entering  Dominican  ports,  this  committee 
recommends  the  establishment  at  the  various  ports  of  boards,  named 
by  the  respective  chambers  of  commerce  or  otherwise,  to  hear  such 
complaints  and  recommend  terms  of  adjustment. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  THE  DOMINICAN  REPUBLIC. 

Luis  GALVAN,  Chairman. 

CHARLES  J.  RHOADS,  Vice  'Chairman. 


ECUADOR. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  OF  THE   TREASURY  OF  THE   UNITED 

STATES. 

SIR:  The  Ecuador  conference  committee  composed  of  the  official 
delegation  of  the  Ecuador  Government,  the  special  representatives 
of  the  Secretary  of  the  Treasury,  and  the  United  States  members  of 
the  group  committee,  as  a  result  of  the  committee  conferences,  begs 
to  submit  the  following  report : 

I.  THE  EFFECT  OF  THE  WAR  ON  COMMERCE  AND  OTHER  ACTIVITIES  OF  THE 

REPUBLIC. 

1.  Upon  the  information  submitted  to  this  committee  it  is  of  the 
opinion  that  the  recent  European  war  during  its  continuance  pro- 
duced the  following  results  in  the  economic  and  business  interests  of 
Ecuador : 

First,  a  very  considerable  stimulation  and  increase  in  the  country's 
production  of  foodstuffs,  such  as  grains,  sugar,  potatoes,  etc.,  to  a 
point  where  the  country  was  enabled  to  raise  a  surplus  sufficient  for 
export;  second,  a  very  considerable  stagnation  in  the  matter  of 
the  import  business  on  account  of  the  scarcity  of  ocean  transporta- 
tion, and  this  condition  also  raised  the  price  of  all  commodities  to 
the  detriment  of  the  purchasing  power  of  the  people;  third,  as  a 
result  of  both  of  the  foregoing,  the  Government  of  Ecuador  was 
prejudiced  during  the  war  to  some  extent  in  its  revenues. 

2.  Regarding  the  urgent  present  public  financial  needs,  the  report 
of  Dr.  Luis  Felipe  Borja,  member  of  the  Ecuadorian  section  of  the 
International  High  Commission,  under  date  of  November  10,  1919, 
states  that  a  foreign  loan  of  $50,000,000  to  $60,000,000  is  indispensable 
to  place  the  country  on  a  sound  financial  footing,  the  proceeds  to  be 
used  to  refund  the  public  debt,  establish  a  national  bank,  to  complete 
the  present  railroad  program,  and  develop  the  natural  resources  of  the 
country. 

Thereupon,  after  discussion,  the  following  resolution  was  adopted : 

I  Resolved,  That  the  conference  committee  approves  in  principle 

the  recommendation  contained  in  the  report  of  Dr.  Borja,  under 
107 


108  SECOND   PAN   AMERICAN   FINANCIAL,   CONFERENCE. 

date  of  November  10,  1919,  providing,  as  it  does,  for  the  refund- 
ing of  the  present  internal  and  external  debt  of  the  Republic  of 
Ecuador  as  a  means  to  the  improvement  of  the  Republic's  credit, 
thereby  enabling  it  to  secure  the  capital  required  "for  the  develop- 
ment of  its  resources 

II.  HOW  CAN  REQUIRED  CAPITAL  AND  CREDIT  FACILITIES  BEST  BE  PROVIDED. 

1.  In  answer  to  the  question,  to  what  extent  these  requirements  can 
be  met  by  domestic  capital,  it  was  explained  by  the  delegation  from 
Ecuador  that  a  surplus  accruing  from  internal  industries  in  1919  of 
approximately  $4,000,000  was  available  for  domestic  loans. 

2.  In  answer  to  the  question  with  regard  to  what  extent  foreign 
capital  is  required : 

(a)  Reference  is  made  to  the  above-mentioned  report  of  Dr.  Borja, 
Discussion  of  this  question  in  detail  brought  out  the  statement 
from  the  delegation  from  Ecuador  that  the  establishment  of  an 
American  branch  bank  or  banks  in  Ecuador  would  be  of  great  value 
to  that  Republic,  as  its  banking  facilities  are  very  limited  and  very 
expensive.     Ecuador   has   banks   for   internal   business,   but   needs 
American  banks  to  assist  in  credit  and  commerce. 
Thereupon  the  following  resolution  was  adopted : 

Resolved,  That  this  committee  recommends  to  the  American 
banks  the  desirability  of  establishing  branches  in  Ecuador  to 
improve  credit  facilities,  exchange,  and  investment  information. 
(b,c,d)  The  following  resolution  was  adopted: 

Resolved,  That  this  committee  is  of  the  opinion  that  the  exten- 
sion of  our  open  discount  for  market  acceptances  would  greatly 
aid  the  financing  of  ^Ecuadorian  foreign  trade.  The  education 
of  American  investors  in  the  field 'of  foreign  loans  would  also 
aid  in  a  large  measure  the  development  of  business  between  Ecua- 
dor and  the  United  States  and  likewise  result  in  the  encourage- 
ment of  the  entrance  into  Ecuador  of  United  States  industrial 
and  commercial  companies. 

III.    NATIONAL    CREDIT    AND    THE   FACTORS    AFFECTING    IT. 

1.  The  total  foreign  debt  of  Ecuador  is  35,206,723.20  sucres  (ap- 
proximately $17,603,362)  and  the  total  internal  debt  21,000,499.21 
sucres  (approximately  $10,500,249). 

The  foreign  debt  is  composed  of  condor  bonds  issued  to  liquidate  a 
small  balance  of  the  old  foreign  debt  incurred  by  Greater  Colombia 
at  the  beginning  of  the  past  century ;  common  bonds  issued  by  the 
North  American  Quayaquil  &  Quito  Railroad  Co.,  under  contract  for 
the  construction  of  a  road,  signed  June  14,  1897,  guaranteed  by  the 
Government  of  Ecuador  at  6  per  cent  annually,  later  reduced  to  5 


REPORT   OF  THE   CONFERENCE    COMMITTEE — ECUADOR.         109 

per  cent ;  salt  certificates  issued  by  the  Ecuador  Government  in  pay- 
ment of  three  coupons  of  the  common  bonds  issued  by  the  said  rail- 
road company  and  guaranteed  by  the  nation. 

At  the  opening  of  the  group  sessions  it  was  announced  that  the 
matter  of  the  Guayaquil  &  Quito  Railroad  would  be  excluded  from 
discussion  by  the  group.    It  was  therefore  not  considered. 
The  following  resolution  was  also  adopted : 

Resolved,  That  the  committee  approves  the  recommendation 
contained  in  a  report  of  the  Chambers  of  Commerce  of  Guaya- 
quil and  Quito  to  the  President  of  Ecuador,  dated  July,  1917, 
urging  the  desirability  of  increasing  the  collection  of  revenues. 

2.  The  national  fiscal  system  is  based  on  direct  and  indirect  taxes. 
The  principal  revenues  are  those  of  the  customhouse,  which  are  im- 
port duties,  revenue  taxes  on  tobacco  and  spirituous  liquors,  and  real 
estate  taxes. 

3.  Ecuador  adopted  the  gold  standard  in  1898  and  the  standard 
coin  minted  is  called  the  condor,  representing  the  value  of  10  sucres, 
equal  to  about  $4.86,  parity. 

4.  Municipal  loans  are  made  only  by  authority  of  the  Central  Gov- 
ernment and  are  guaranteed  by  liens  on  municipal  revenues  and 
municipal  properties. 

IV.    EFFECT  OF  THE  WAR  ON  TRANSPORTATION  FACILITIES. 

Before  the  war  the  steamships  of  the  following  lines  touched  regu- 
larly at  Guayaquil,  according  to  the  information  given  us:  Pacific 
Steam  Navigation  Co.,  Peruvian  Line,  Chilean  Line,  Cosmos  Line; 
and  steamships  of  the  following  lines  touched  irregularly,  besides 
tramp  steamers  occasionally :  W.  R.  Grace  &  Co.'s  Line  and  Lamport 
&  Holt  Line. 

Since  1914  the  only  steamers  calling  regularly  have  been  those  of 
the  Pacific  Steam  Navigation  Co.  It  is  announced  that  a  steamer  of 
a  new  line,  the  Ecuador  Line,  will  shortly  begin  sailings  from  New 
Orleans  to  Guayaquil. 

In  general  the  service  is  stated  to  be  the  worst  in  a  period  of  25 
years. 

The  imports  in  1917  and  for  10  years  previous  were  $10,000,000  an- 
nually. 

The  exports  in  1917  amounted  to  $16,000,000,  an  increase  from  a 
former  average  of  $12,000,000. 

Due  to  the  changes  caused  by  the  war,  it  is  stated  that  now  about  80 
per  cent  of  the  foreign  commerce  of  Ecuador  is  with  the  United  States, 
mostly  New  York. 

In  the  address  of  Chairman  John  Barton  Payne,  of  the  United 
Shipping  Board,  it  was  stated  that  it  is  designed  to  run  vessels  from 


110  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

New  York  to  the  west  coast  of  South  America,  stopping  at  Callao 
and  other  ports  to  the  south,  which  seems  to  omit  Guayaquil. 

The  sentiment  of  the  delegation  and  group  committee  as  to  the 
shipping  needs  of  Ecuador  is  expressed  by  the  following  resolution 
duly  adopted : 

Whereas  the  Ecuadorian  delegation  reports  that  the  port  of 
Guayaquil  has  for  10  months  been  free  of  yellow  fever ;  and 

Whereas  since  the  beginning  of  the  war  the  trade  between  the 
United  States  and  Ecuadorian  ports  has  increased  about  four 
times :  Therefore  be  it 

Resolved,  That  Ecuador  would  be  greatly  benefited  by  more 
prompt  and  regular  steamship  service  between  the  United  States 
ports  and  Ecuadorian  ports,  especially  between  the  ports  of  New 
York  and  Guayaquil; 

Therefore  effort  should  be  made  to  induce  the  United  States 
Shipping  Board  and  other  appropriate   agencies  to  establish 
regular  service  as  above  stated. 
The  following  resolution  was  also  adopted : 

Whereas  the  opinion  of  the  committee,  from  the  information 
laid  before  it,  is  that  the  future  commercial  growth  of  Ecuador 
is  dependent  on  adequate  transportation  facilities  and  the  im- 
provement of  the  port  of  Guayaquil : 

Resolved,  That  the  deepening  of  the  Guayas  River  at  certain 
points  to  enable  the  admission  of  vessels  of  a  larger  tonnage  and 
the  construction  of  a  dock  at  Guayaquil  of  such  a  nature  as 
to  permit  bringing  vessels  of  maximum  tonnage  alongside,  thus 
obviating  delays  and  doing  away  with  the  expensive  lighterage 
charges,  are  two  measures  of  imperative  importance. 
What  has  been  perhaps  the  chief  obstacle  to  regular  shipping,  it 
is  stated,  has  been  the  presence  in  the  past  of  yellow  fever  at  Guaya- 
quil.    But  this  has  now  been  removed.    The  Government  of  Ecua- 
dor, with  the  assistance  of  the  Rockefeller  Foundation,  under  the 
personal  direction  of  Gen.  Gorgas,  has  eradicated  yellow  fever  from 
Guayaquil  since  March,  1919. 

In  view  of  this  important  fact  it  is  urgently  set  forth  that  the 
commercial  union  of  Ecuador  and  the  United  States  be  closer  bound 
by  an  allotment  of  necessary  transportation  to  carry  the  commerce 
of  the  two  countries. 

V.  MEASURES  TO  FACILITATE  COMMERCIAL  INTERCOURSE. 

1.  A  convention  between  the  United  States  and  Ecuador  concern- 
ing commercial  travelers  was  signed  December  31,  1919,  and  was 
approved  by  the  United  States  Senate  and  is  awaiting  action  by  the 
Congress  of  Ecuador. 


REPORT   OF   THE   CONFERENCE    COMMITTEE ECUADOR.         HI 

2.  This  committee  recommends  the  adherence  by  Ecuador  to  the 
convention  to  establish  an  international  gold  clearance  fund. 

3.  Inasmuch  as  there  is  already  in  force  between  the  United  States 
and  Ecuador  a  parcel  post  convention,  no  action  other  than  a  recom- 
mendation for  the  improvement  of  the  existing  service  and  a  recom- 
mendation for  better  packing  on  the  part  of  shippers  from  the 
United  States  is  considered  necessary. 

VI.  THE  DEVELOPMENT  OF  UNIFORMITY  OF  LEGISLATION. 

1.  The  following  resolution  was  adopted  by  the  committee : 

It  is  urgently  suggested  to  the  Government  of  Ecuador  that 
the  recommendations  of  the  meeting  of  the  International  High 
Commission  held  at  Buenos  Aires  in  1916  in  regard  to  uniform 
consular  invoices  be  adopted.  Also,  that  a  strict  enforcement  be 
given  to  the  terms  of  bills  of  lading.  In  connection  with  this 
subject  it  is  also  suggested  that  the  Republic  of  Ecuador  take 
under  consideration  the  adoption  of  a  law  on  bills  of  lading  simi- 
lar to  the  act  of  Congress  of  the  United  States  (Federal  bills  of 
lading  act). 

The  following  resolution  was  also  adopted : 

Resolved,  That  the  committee  recommends  the  adoption  by 
Ecuador  of  a  special  law  dealing  with  conditional  sales,  leases, 
and  chattel  mortgages  by  which  the  consignor  may  be  more  fully 
protected  against  sale  of  the  goods  by  the  consignee. 

The  chairman  laid  the  following  communication  before  the  com- 
mittee : 

The  Director  of  the  Pan  American  Union  most  respectfully 
suggests  that  each  group  recommend: 

First.  Each  Government  of  the  Pan  American  Union  shall 
arrange  that  regularly  and  permanently  its  various  departments 
and  bureaus  shall  deposit  in  the  library  of  the  Pan  American 
Union  two  copies  of  all  informative  official  publications,  maps, 
and  other  data. 

Second.  That  each  Government  consider  the  advisability  of 
preparing  under  its  direction  a  comprehensive  standard  hand- 
book, in  English,  describing  its  financial,  commercial,  material, 
and  other  conditions,  to  be  distributed  through  the  Pan  American 
Union. 

Third.  That  each  Government  deposit  in  the  Pan  American 
Union,  for  exhibit  whenever  necessary,  films  descriptive  of  its 
life  and  resources. 

Fourth.  That  every  effort  be  made  by  each  Government  to 
make  the  Pan  American  Union  a  practical,  up-to-date  central 
bureau  of  information. 


112  SECOND  PAN  AMERICAN  FINANCIAL  CONFERENCE. 

The  foregoing  recommendation  was  upon  motion  unanimously 
approved  by  the  committee. 

The  committee  members  representing  the  United  States  desire  to 
express  in  a  formal  manner  its  appreciation  of  the  opportunity  given 
by  this  conference  to  confer  with  the  delegation  from  Ecuador  in  re- 
gard to  the  commercial,  financial,  and  other  topics  of  interest  and  con- 
cern mutual  to  our  two  countries.  Not  only  will  practical  good  fol- 
low in  a  material  way,  but  the  acquaintance  formed  will  tend  to  bind 
our  two  peoples  in  those  closer  bonds  of  friendship  which  it  is  evident 
that  both  desire  to  encourage  and  which  will  be  of  common  benefit. 
The  committee  appreciates  the  visit  and  presence  of  the  distinguished 
delegates'  from  Ecuador  and  considers  it  an  honor  to  have  had  the 
privilege  of  association  with  them  for  the  furtherance  of  good  rela- 
tions. Our  best  wishes  go  with  them  on  their  return  to  their  native 
land  and  we  desire,  in  our  capacity  as  representatives  of  the  people  of 
the  United  States  for  the  purposes  of  this  conference,  that  they  be  ex- 
tended to  His  Excellency  the  President  of  Ecuador,  and  the  people  of 
that  Republic. 

Resolved,  That  the  thanks  of  the  members  of  the  committee  be  ex- 
tended to  the  chairman  and  vitee  chairman  of  the  group  committee  for 
the  splendid  manner,  in  which  the  transactions  of  the  group  have  been 
conducted  and  the  courtesy  extended  to  all  of  its  members ;  and 

That  the  committee  of  the  Second  Pan  American  Financial  Con- 
ference wishes  to  record  its  thanks  to  Col.  George  T.  Weitzel,  of 
Washington,  for  the  efficient  and  helpful  manner  in  which  he  has  dis- 
charged the  duties  of  his  office  as  secretary  of  the  committee. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  ECUADOR, 
R.  H.  ELIZALDE,  Chairman. 
E.  M.  HERR,  Vice  Chairman. 


GUATEMALA. 


REPORT  OF  THE  CONFERENCE  COMMITTEE, 


The  honorable  the  SECRETARY  OF  THE  TREASURY  or  THE  UNITED 
STATES. 

SIR:  The  group  committee  for  Guatemala  has  devoted  itself  to 
the  consideration  of  the  subjects  in  the  program  of  the  Second  Pan 
American  Financial  Conference,  and  has  the  honor  to  submit  the 
following  report,  which  was  unanimously  adopted  by  its  members: 

I.  THE  EFFECT  OF  THE  WAR  ON  THE  COMMERCE  AND  INDUSTRY,  MANU- 
FACTURING AND  MINING,  AGRICULTURAL  AND  PUBLIC  UTILITIES  OF 
THE  REPUBLICS  OF  THE  AMERICAN  CONTINENT. 

The  war  was  the  source  of  many  difficulties  for  Guatemala  in  that 
it  diminished  its  imports  and  reduced  the  price  of  its  coffee,  while, 
on  the  other  hand,  it  caused  the  price  of  commodities  coming  from 
abroad  greatly  to  increase.  In  1918  there  was  a  distinct  decrease  in 
the  capital  available  for  investment  in  real  estate  mortgages,  whether 
in  national  paper  currency  or  in  gold  currency.  Nevertheless,  the 
high  prices  which  coffee  has  brought  since  the  war  are  tending  to 
stimulate  the  development  of  the  coffee  industry  and  the  improved 
plantations  already  in  existence.  During  the  war  the  Government 
enacted  several  laws  with  a  view  to  encourage  further  the  develop- 
ment of  the  natural  agricultural  resources  of  the  country  and  to 
increase  the  cultivation  of  those  products  for  which  its  soil  is  so 
excellently  suited.  The  resulting  increase  in  the  production  of 
many  different  articles  of  consumption  offset  in  a  large  measure  the 
effects  of  the  war,  which  were  therefore  felt  less  keenly  in  Guate- 
mala than  in  many  other  countries. 

The  most  urgent  need  not  only  in  commerce  and  industry,  but  in 
all  branches  of  the  national  development,  is  for  foreign  capital. 
Local  funds  are  not  readily  available  for  large  undertakings,  inas- 
much as  available  local  capital  is  being  absorbed  in  the  process  of 
reconstructing  Guatemala  City,  lately  razed;  by  an  earthquakje. 
Another  vital  necessity  for  the  development  of  the  commerce  and 
industry  of  Guatemala  is  the  adoption  of  the  gold  standard,  and  the 
establishment  of  an  equitable  exchange  rate  for  the  conversion  of  the 
paper  currency  and  its  ultimate  redemption. 

14970—21 8  113 


114  SECOND  PAN  AMERICAN   FINANCIAL  CONFERENCE. 

II.  How  CAN  REQUIRED  CAPITAL  AND  CREDIT  FACILITIES  BE  PROVIDED  ? 

Your  committee  considered  particularly  the  question  of  monetary 
and  banking  reform,  a  matter  now  under  serious  consideration  on  the 
part  of  the  Government  of  Guatemala.  Two  projects  of  reform  were 
considered,  of  which  the  first  has  been  drawn  up  by  a  commission 
designated  some  time  ago  by  the  Guatemalan  Government  for  the 
purpose  of  establishing  a  national  bank  of  Guatemala,  and  the  second 
of  which  was  to  be  found  in  the  report  of  Prof.  E.  W.  Kemmerer, 
prepared  at  the  request  of  the  President  of  the  Republic  and  deliv- 
ered to  him  September  6,  1919.  These  proposals  were  found  to  be 
similar  in  character  and  to  differ  only  in  details. 

After  sustained  and  careful  review  of  the  two  plans,  the  com- 
mittee reached  the  conclusion  that,  at  the  present  time,  a  reform  of 
the  banking  and  currency  situation  of  Guatemala  could  be  effected 
with  less  difficulty  than  at  any  other  time  in  the  economic  history  of 
the  Republic.  Nothing  less  should  be  undertaken  than  a  complete 
and  thoroughgoing  reform,  calculated  to  give  the  country  perma- 
nently a  modern  and  scientific  currency  and  banking  system  as  good 
as  any  in  existence.  The  committee  believes  that  the  monetary  unit 
of  the  Republic  should  be  one-half  gram  of  pure  gold,  based  on  the 
metric  system  and  divided  into  10  pesos  or  100  centimos,  the  peso  to 
be  worth  10  centimos.  This  unit  would  then  be  worth  one-third  of  a 
gold  dollar  of  the  United  States,  after  adding  a  slight  coinage  charge 
of  approximately  0.003.  Guatemala  should  coin  on  Government  ac- 
count new  fiduciary  silver  coins  having  a  gold  value  larger  than  the 
value  of  their  respective  silver  content.  With  a  view  to  preserve  the 
parity  of  gold  new  silver  coins  and  the  minor  coins  of  bronze,  nickelr 
and  copper,  the  excessive  issue  of  the  various  classes  of  coins  and  de- 
nominations of  money  should  be  prevented  by  legislation. 

A  gold  reserve  to  be  known  as  the  gold  standard  fund  should  be 
created  by  the  Government  and  all  coins  in  circulation  should  be  ac- 
cepted by  the  Government  in  payment  of  taxes  and  other  Government 
dues. 

The  gold  reserve  should  be  a  trust  fund,  separate  from  other  Gov- 
ernment moneys,  and  used  exclusively  for  the  purpose  of  maintain- 
ing the  parity  of  the  fiduciary  coins  with  gold.  Part  of  this  fund 
should  be  kept  on  deposit  under  proper  security  with  bankirig 
houses  of  high  standing  abroad. 

The  Government  should  obligate  itself  to  redeem  its  fiduciary 
currency  fwhen  offered  in  amounts  not  less  than  a  fixed  sum,  either 
in  gold  or  in  demand  of  the  gold  drafts  issued  on  foreign  financial 
centers  in  which  the  gold-standard  fund  would  be  deposited.  In 
other  words,  the  fundamental  principles  of  the  gold-exchange  stand- 
ard should  be  followed. 


REPORT  OF  THE  CONFERENCE  COMMITTEE GUATEMALA.       115 


For  the  purpose  of  placing  the  currency  and  banking  system  of 
Guatemala  upon  the  most  modern  and  scientific  basis,  there  should 
be  established  a  national  bank,  with  the  powers  and  duties  usually 
possessed  by  national  banks  in  other  countries.  It  should  have  an 
authorized  capital  of  sixty  million  gold  units  ($20,000,000  United 
States  gold),  and  a  paid-up  capital  of  not  less  than  fifteen  million 
gold  units  ($5,000,000  United  States  gold).  This  capital  should  rep- 
resent as  widespread  a  financial  interest  as  possible.  The  bank 
should  be  subject  to  a  reasonable  kind  of  Government  supervision, 
and  the  Government  ought  to  participate  in  any  profits  accruing 
above  a  fixed  percentage  of  capital. 

The  national  bank  should  be  given  liberal  rights  of  note  issue, 
rights  which  ultimately  ought  to  be  exclusive.  The  note-issue  privi- 
lege, however,  ought  to  be  restricted  in  such  a  way  as  to  prevent 
circulation  in  excess  of  three  times  the  amount  of  the  cash  paid-in 
capital. 

The  national  bank  ought  to  be  in  a  position  to  make  loans  to  the 
Government,  in  the  form  of  advances  of  its  own  notes  and  at  a 
reasonable  rate  of  interest,  for  the  payment  of  the  debts  of  the 
Government  to  the  several  banks. 

Subject  to  certain  qualifications,  the  banks  now  in  existence  should 
be  required  to  retire  at  once  the  outstanding  notes  to  an  amount  equal 
to  four-fifths  of  the  sums  paid  them,  respectively,  by  the  Govern- 
ment in  the  settlement  of  its  debt  to  them,  provided  that  notes  to  an 
equal  amount  are  outstanding,  and  provided  further,  that  a  limited 
note  circulation  be  allowed  to  banks  of  issue,  the  charters  of  which 
have  not  expired,  for  the  remaining  years  of  the  respective  conces- 
sions. After  the  expiration  of  existing  charters  the  national  bank 
should  receive  the  exclusive  right  of  note  issue  in  the  Eepublic. 
Notes  of  the  national  bank  should  be  unlimited  tender  as  long  as 
they  are  redeemable  on  demand  in  gold  or  in  its  equivalent. 

The  national  bank  should  be  authorized  to  make  loans,  discounts, 
and  rediscounts  of  short  maturities  on  self-liquidating  paper,  but  it 
should  not  be  permitted  to  make  capital  loans  on  real  estate  or  on 
other  not  readily  negotiable  securities. 

The  national  bank,  however,  should  be  permitted  to  advance  money 
on  mortgages  where  guaranty  is  given  by  an  existing  bank,  but  the 
funds  so  employed  should  be  limited  to  one-third  the  amount  by 
which  the  paid-up  capital  and  surplus  exceeds  150  per  cent  of  the 
debt  due  it  from  the  Government. 

IV.  THE    EFFECTS    OF   THE   WAR    ON    TRANSPORTATION    FACILITIES, 
EEQUIREMENTS  OF  THE  PRESENT  AND  IMMEDIATE  FUTURE. 

There  should  be  established  one  or  more  lines  of  vessels  between  the 
ports  of  Guatemala  and  the  ports  of  other  American  Republics.  The 
recommendation  is  offered  that,  in  so  far  as  may  be  possible,  the  ship- 


116  SECOND  PAN  AMERICAN  FINANCIAL  CONFERENCE. 


ping  companies  of  the  United  States  reestablish  well-fixed  routes  in 
existence  before  the  war. 

Your  committee  is  inclined  to  recommend  that  the  freight  rates  be 
restored  as  soon  as  possible  to  what  they  were  before  the  war,  taking 
into  account  the  increased  cost  of  operation;  that  steamship  com- 
panies give  the  greatest  care  to  the  good  treatment  of  passengers  and 
that,  where  necessary,  changes  be  effected  to  make  the  trips  as  com- 
fortable as  possible.  In  the  traffic  on  the  Pacific  between  the  ports 
of  North  America  and  those  of  South  America,  it  is  essential  that 
shipping  schedules  include  ports  of  Central  America. 

It  is  imperative  that  those  companies  of  the  United  States  to  which 
commercial  and  transportation  concessions  have  been  accorded  should 
not  adopt  policies  involving  discrimination  in  rates  or  methods  of 
procedure  in  respect  to  the  several  patrons  and  localities  with  which 
they  deal. 

V.  MEASURES  TO  FACILITATE  COMMERCIAL  INTERCOURSE  AMONG  THE 
AMERICAN  REPUBLICS. 

The  committee  believes  that,  in  so  far  as  may  be  possible,  consular 
and  other  trade  representatives  appointed  to  serve  the  interests  of 
the  United  States  in  Latin  America,  and  vice  versa,  should  be  able 
to  speak  and  write  without  the  aid  of  an  interpreter  the  language 
of  the  country  to  which  they  are  sent ;  and  in  this  way  many  unnec- 
essary and  vexatious  delays  and  costly  misunderstandings  will  be 
avoided. 

The  committee  furthermore  believes  that  it  would  prove  mutually 
advantageous  if  there  were  established  on  as  broad  a  basis  as  possible 
scholarships  at  the  leading  universities  of  the  United  States  for 
earnest  students  from  the  universities  of  the  other  American  Re- 
publics, and  that,  as  well,  there  should  be  established  an  annual  ex- 
change of  professors  between  the  leading  universities  of  the  United 
States  and  those  of  the  other  American  nations. 

The  committee  also  believes  that  the  United  States  should  be  urged 
to  consider  the  advisability  of  adopting  the  metric  system  of  weights 
and  measures,  which  is  now  in  use  on  the  part  of  the  other  American 
Republics  and,  as  well,  in  almost  all  the  European  countries. 

The  committee  is  also  of  the  opinion  that  the  United  States  should, 
through  the  Department  of  Agriculture,  send  to  the  other  American 
Republics  from  time  to  time  skilled  agriculturists  and  experts  in 
the  cultivation  of  medicinal  plants,  so  as  to  gather  information  re- 
garding the  horticultural  and  agricultural  products  capable  of  being 
produced  in  the  American  Republics  for  food  and  medicinal  or  other 
purposes. 


REPORT  OF  THE  CONFERENCE  COMMITTEE GUATEMALA.       117 

Your  committee  likewise  feels  that  the  students  in  our  schools 
and  educational  institutions  ought  to  be  given  better  and  more  fre- 
quent opportunities  for  agricultural  information  concerning  Latin 
America,  through  the  display  of  maps,  charts,  and  diagrams  of  those 
countries,  so  that  the  future  citizens  of  the  United  States  may  become 
better  acquainted  with  those  countries  and  aware  of  the  advantages 
of  entering  into  relations  with  them. 

It  is  likewise  believed  by  your  committee  that  in  order  to  encour- 
age, stimulate,  and  facilitate  commerce  and  intercourse  between  the 
American  nations,  the  United  States  Government  ought  to  be  pressed 
to  consider  the  advisability  of  establishing  free  ports  or  free  zones 
in  its  great  commercial  terminal  centers;  while,  on  the  other  hand,, 
establishment  of  similar  free  ports  or  free  zones  ought  to  be  recom- 
mended to  the  other  Republics  as  well. 

Exporters  of  the  United  States  should  regularly  grant  to  their 
Latin- American  customers  terms  of  credit  of  not  less  than  90  days 
for  the  payment  of  merchandise  purchased. 

It  is  also  agreed  by  your  committee  that  agents  ought  to  be  sent 
to  Latin  America  who  are  not  only  well  acquainted  with  the  manner 
of  presenting  their  goods,  but  who  also  are  of  such  a  sort  as  to  pay 
particular  attention  to  the  characteristics  of  their  Latin- American 
clientele,  in  order  that  its  requirements  may  be  learned,  so  as  better 
to  promote  business  intercourse  with  merchants  of  the  United  States. 

The  convention  to  establish  an  international  gold  clearance  fund 
has  already  been  signed  by  Guatemala  and  the  United  States. 

VI.  THE  DEVELOPMENT  OF  UNIFORMITY  OF  LEGISLATION. 

The  uniformity  of  customs  regulations  is  a  difficult  matter  to 
achieve  in  a  practical  way  because  of  the  different  conditions  and 
peculiarities  of  countries  and  even  of  ports.  However,  by  careful 
study  those  of  the  rules  and  regulations  which  do  not  affect  in  any 
special  way  any  one  of  the  countries  can  be  reduced  to  uniformity. 
In  accordance  with  this  belief  the  Government  of  Guatemala  has 
sent  to  the  office  of  the  commission  at  Washington  the  customs  law 
of  1894,  which  is  now  in  force. 

Not  infrequently  it  happens  that  prices  given  in  consular  invoices 
are  below  those  that  the  merchandise  is  known  to  bring  in  the  mar- 
kets of  the  country  of  origin.  This  should  not  be  so.  It  is  a  situation 
capable  of  being  avoided,  if  consuls  will  require  that  the  original 
commercial  invoice  be  produced  and  investigate  prices  in  the  markets 
and  exchanges. 

For  the  sake  of  greater  emphasis  your  committee  ventures  to  repeat 
the  recommendation  with  regard  to  uniformity  of  customs  regula- 
tions and  classification  of  merchandise,  which  is  to  be  found  in  the 


118  SECOND  PAN   AMERICAN   FINANCIAL,  CONFERENCE. 


report  made  by  the  section  of  the  United  States  of  the  International 
High  Commission  to  the  commission  at  Buenos  Aires  (Reports  of 
Committees,  Washington,  1916,  Topic  III,  pp.  16  and  following). 

The  laws  of  Guatemala  on  bills  of  exchange,  checks,  and  notes  are 
those  of  The  Hague  convention  and  uniform  rules.  These  laws  were 
approved  by  the  national  assembly  in  decree  No.  874,  May  12,  1913, 
and  were  ratified  by  the  executive  power  May  30,  1913.  Conse- 
quently that  international  agreement  constitutes  the  law  of  Guate- 
mala in  this  respect. 

This  committee  indorses  the  recommendations  of  the  Internatioi 
High  Commission  with  respect  to  Topic  2,  section  6. 

A  contract  covering  a  consignment  of  merchandise  is  generally 
based  on  stipulations  approved  by  the  parties  to  the  instrument,  and 
also  on  the  usages  accepted  in  the  trade.  The  exportation  of  the 
coffee  crop  and  the  loans  effected  on  an  obligation  to  consign  the  prod- 
ucts which  can  readily  be  exported  have  no  appropriate  legislation 
among  the  commercial  laws  of  the  several  nations.  Those  cases  for 
which  provision  is  not  made  in  the  contracts  usually  entered  into  are 
decided  under  general  dispositions  contained  in  the  codes  under  the 
heading  "  Commission  merchants  "  and  "  Purchase  and  sale  of  condi- 
tional loans." 

Guatemala  has  no  chamber  of  commerce.  Until  this  important 
agency  shall  have  been  established,  it  can  not  be  expected  that  agree- 
ments can  be  entered  into  between  the  chambers  of  commerce  of  the 
different  countries  and  Guatemala,  nor  can  the  latter  Republic  co- 
operate with  the  others  in  the  development  of  uniform  legislation 
on  the  subject  of  commercial  arbitration. 

This  committee  recommends  the  establishment  of  a  chamber  of 
commerce  in  Guatemala  with  a  view  to  carry  out  arbitration  of  the 
commercial  disputes  which  may  arise  between  persons  resident  in 
Guatemala  and  those  living  in  other  American  nations,  and  with  a 
view  also  to  give  effect  to  the  important  aims  generally  had  by  cham- 
bers of  commerce. 

Guatemala  has  incorporated  into  her  legislation  the  Buenos  Aires 
trade-mark  convention.  It  has  approved  and  ratified  the  conven- 
tion and  the  result  of  such  action  now  depends  on  the  functioning  of 
the  international  office  set  up  at  Habana. 

The  measures  taken  for  the  regulation  and  protection  of  art  and 
of  literary  property  rights  in  accordance  with  constitutional  princi- 
ples are  those  embodied  in  the  convention  of  *Buenos  Aires  on  this 
subject,  and  this  has  already  been  approved  and  ratified.  The  same 
is  to  be  said  concerning  patents  and  industrial  models  and  designs. 
The  Buenos  Aires  convention  on  this  matter  was  ratified  by  Guate- 
mala May  10, 1912. 


REPORT  OF  THE  CONFERENCE  COMMITTEE — GUATEMALA.       119 

Book  III  of  our  Commercial  Code  is  taken  up  exclusively  with  sea- 
borne trade,  the  persons  who  take  part  therein,  maritime  contracts, 
the  perils  of  transportation,  the  subject  of  insurance  and  analogous 
matters.  Our  Government  has  concluded  conventions  and  treaties 
for  the  protection  of  its  commerce  and  the  regulation  of  cases  of 
shipwreck  and  danger. 

The  ports  of  Guatemala  are  open  to  the  commerce  of  the  world 
and  ships  touching  them  are  subject  to  the  following  charges: 

United  States  gold. 

Lighthouse   dues $10.  00 

Health  certificate 4.  50 

Wharf   dues .  50 

Unloading  charges   (per  1,000  pounds) 1.50 

Loading  charges  (per  1,000  pounds) 1.00 

At  the  ports  of  San  Jose,  Champerico,  and  Ocos  there  have  been 
established  private  agencies  to  which  dues  for  services  rendered  are 
paid. 

.Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  GUATEMALA, 
Luis  TOLEDO  HERRARTE,  Chairman. 
JOHN  CLAUSEN,  Vice  Chairman. 


HAITI. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the  SECRETARY  OF  THE  TREASURY  OF  THE   UNITED 

STATES. 

SIR  :  The  conference  committee  on  the  Republic  of  Haiti,  composed 
of  the  official  delegates  of  the  Republic  of  Haiti  and  the  American 
members  of  the  group  committee,  having  met  and  duly  considered 
the  program  of  topics  agreed  upon  for  discussion,  has  the  honor  to 
submit  the  following  unanimous  report. 

I.  THE  EFFECT  OF  THE  WAR  ON  THE  COMMERCE  AND  INDUSTRY,  MANUFAC- 
TURING AND  MINING,  AGRICULTURE  AJXD  PUBLIC  UTILITIES  OF  THE 
REPUBLIC  OF  HAITI. 

1.  Due  to  the  withdrawal  of  shipping  needed  by  the  nations  at  warr 
transportation  of  practically  all  products  of  agriculture  which  con- 
stitute the  bulk  of  Haiti's  exports,  was  entirely  shut  off  at  the  begin- 
ning of  hostilities,  with  the  exception  of  the  limited  amount  of  goods 
shipped  to  the  United  States.    The  crops  of  coffee,  cotton,  and  log- 
wood had  to  be  stored  or  sold  at  sacrifice.     During  the  first  months 
of  the  war  there  was  no  incentive  to  produce  more  in  crops  than 
actually  needed  for  local  use. 

To  meet  the  urgent  requirements  of  the  United  States  for  castor 
oil,  attention  was  directed  to  raising  castor  beans,  and  its  export  was 
reaching  considerable  proportions  when  the  armistice  closed  that 
channel. 

Logwood  production  and  export  reached  high  figures  during  the 
war,  meeting  a  demand  due  to  scarcity  of  dyestuffs  and  synthetic 
dyes. 

Latterly  the  production  of  sugar,  corn,  coffee,  cacao,  and  cotton  has 
increased,  interest  in  agriculture  has  been  stimulated,  and  a  large 
corporation  from  the  United  States  has  finished  the  construction  of 
sugar  warehouses  at  Port  au  Prince.  Much  land  of  great  fertility 
and  good  depth  of  soil  is  found  in  the  valley  sections.  Native  labor 
is  pronounced  capable,  strong,  and  willing,  and  can  be  procured  at 
the^very  favorable  rate  of  2  gourdes  per  day. 

2.  Other  than  the  public  debts,  external  and  internal,  existing 
financial  obligations  are  of  a  private  nature  and  are  liquidated  in  a 

120 


REPORT   OF   THE    CONFERENCE   COMMITTEE HAITI.  121 

satisfactory  manner.  Capital  is  urgently  needed  for  the  develop- 
ment of  public  utilities,  good  roads,  agriculture,  and  the  varied  indus- 
tries which  the  country  with  its  wonderful  natural  resources  can  sup- 
port. More  American  money  has  been  invested  in  Haiti  since  the 
treaty,  and  particularly  since  1916,  than  ever  before. 

The  suggestion  of  the  official  Haitian  delegation  that  some  means 
of  disseminating  information  in  the  United  States  regarding  the 
resources  and  commercial  opportunities  in  Haiti,  by  organized 
propaganda,  be  established  was  approved  by  the  conference  commit- 
tee as  being  one  of  the  best  means  of  attracting  capital  to  Haiti. 

II.    HOW   CAN   REQUIRED    CAPITAL  AND    CREDIT   FACILITIES   BEST    BE 

PROVIDED  ? 

1.  Domestic  capital  suffices  for  the  present  for  the  small  develop- 
ment of  the  agriculture  and  internal  trade  relations  of  the  country. 

2.  Foreign  capital  is  required  for  the  development  of  the  full 
natural  resources  of  the  island. 

The  American  Foreign  Banking  Corporation,  the  Royal  Bank  of 
Canada,  and  the  National  Bank  of  Haiti  are  established  and  meeting 
the  present  needs  of  the  island,  the  latter  institution  maintaining 
branches  in  the  principal  towns  on  the  coast  and  in  the  interior. 
Assurance  is  given  that  these  banks  are  abundantly  able  and  willing 
to  extend  the  fullest  facilities  to  assist  in  the  development  of  trade 
and  commerce  in  the  Republic  as  their  growth  requires. 

III.    NATIONAL  CREDIT   AND  THE  FACTORS   AFFECTING   IT. 

The  national  public  debt  consists  of  the  external  loans  of  1875, 
1896,  and  1910,  amounting  in  the  aggregate  to  approximately 
95,000,000  francs.  The  loan  of  1875  bears  5  per  cent  interest  and 
is  secured  by  a  tax  of  33J  cents  on  each  100  pounds  of  coffee  ex- 
ported from  the  Republic. 

The  loan  of  1896  bears  interest  at  the  rate  of  6  per  cent  and  is 
secured  by  the  proceeds  of  a  tax  of  $1.20  gold  on  each  100  pounds  of 
coffee  exported  from  the  Republic.. 

The  loan  of  1910  bears  interest  at  the  rate  of  5  per  cent  per  annum 
and  is  secured  by  a  tax  of  $1  gold  on  each  100  pounds  of  coffee  ex- 
ported and  by  a  special  15  per  cent  additional  tax,  in  gold,  on  the 
import  duties. 

Haiti  has  established  a  high  record  for  probity  in  its  service  of 
the  public  debt. 

Under  the  terms  of  the  protocol  a  new  currency  system  has  been 
established,  providing  a  currency  secured  by  a  gold  reserve  of  33J 
per  cent  and  the  balance  in  two-name  commercial  paper. 


122  SECOND   PAN   AMERICAN   FINANCIAL,   CONFERENCE. 

A  new  loan  is  now  being  undertaken  to  provide  adequately  for  the 
refunding  of  the  old  external  and  internal  loans,  the  development  of 
internal  improvements,  particularly  highways,  irrigation  projects, 
the  building  of  schools  and  other  educational  facilities. 

The  Haitian  Government  is  undertaking,  coincident  with  its  mone- 
tary reform,  a  reform  of  its  commercial  code  and  those  laws  affecting 
foreign  investment  in  such  a  way  as  to  make  their  legal  system 
attractive  to  foreign  capital;  the  same  holds  good  of  the  judicial 
system. 


IV.    THE  EFFECT  OF  THE  WAR  ON  TRANSPORTATION  FACILITIES REQUIRE 

MENTS  OF  THE  PRESENT  AND  IMMEDIATE  FUTURE. 

During  the  war  ships  were  very  largely  taken  out  of  the  Haitian 
trade,  and  for  weeks  at  a  time  no  ships  made  any  Haitian  port.  At 
present  the  Panama  Railroad  Steamship  Co.  and  the  Royal  Dutch 
Line  furnish  a  reasonable  dependable  freight  and  passenger  service, 
but,  of  course,  all  cargo  space  available  for  Haiti  is  more  or  less  sub- 
ject to  the  demand  of  more  southern  countries.  Several  steamship 
companies  are  known  to  have  expressed  their  willingness  to  estab- 
lish routes  to  Haiti  upon  the  appearance  of  dependable  cargo.  Many 
now  make  occasional  trips,  but  all  at  rates  that  seem  high.  These 
rates  are  probably  not  excessive  by  comparison  with  those  to  other 
ports.  We  would  recommend  the  encouragement  of  additional  and 
better  steamship  facilities,  and  the  Haitian  Government  offers  to 
cooperate  with  the  United  States  Shipping  Board  toward  that  end. 

Interior  transportation  would  best  be  served  by  the  construction 
of  more  complete  systems  of  wagon  roads,  as  the  material  to  be 
moved,  pending  further  development  of  the  country,  is  compara- 
tively light  and  movable  over  great  distances  by  the  present  method 
of  bull  carts,  burros,  individual  carriers,  and  coastwise  vessels. 

The  laws  and  regulations  regarding  transportation  both  by 
steamer  and  by  rail  are  being  impnwed,  but  apparently  still  remain 
as  a  hindrance  to  the  best  service.  Numerous  dues  are  put  upon 
ocean  traffic,  such  as  lighthouse,  wharfage,  and  other  port  dues,  but 
these  are  not  considered  excessive,  excepting  the  lighthouse  dues, 
which  will  cease  to  be  charged  after  the  1st  of  next  March,  when  the 
original  lighthouse  concession  expires. 

It  would  appear  that  a  quarantine  station  should  be  established 
at  Port-au-Prince  as  no  facilities  are  now  available  for  disinfecting 
inbound  vessels,  which  is  admitted  to  be  highly  important. 

In  conclusion,  we  again  mention  the  necessity  of  more  extended 
wagon  roads  over  the  country  as  a  development  that  should  exceed 
any  additional  railroad  construction  at  the  expense  of  the  Govern- 


- 


EEPORT   OF   THE    CONFERENCE    COMMITTEE HAITI.  123 

ment.  The  building  of  such  wagon  roads  should  be  the  principal  item 
of  Government  expense  and  as  the  revenues  for  such  purposes  are 
somewhat  limited,  additional  funds  should  be  made  immediately 
.available  through  the  projected  loan. 

V.  MEASURES     TO     FACILITATE     COMMERCIAL     INTERCOURSE     AMONG     THE 

AMERICAN  REPUBLICS. 

The  Republic  of  Haiti  desires  to  adhere  to  all  the  measures  which 
are  drawn  up  for  the  promotion  of  Pan  American  relations  and  will 
give  such  measures  its  most  earnest  consideration. 

1.  The  convention  concerning  commercial  travelers. — The  Haitian 
Executive  has  signed  this  convention,  and  it  will  be  submitted  for 
ratification  at  the  next  meeting  of  the  legislature. 

2.  The   convention   to  establish  an  international  gold  clearance 
fund.— This  convention  has  been  very  recently  signed  by  the  Haitian 
Government,  and  will  be  submitted  for  ratification. 

3.  Parcel  post  facilities  and  lower  postal  rates. — Haiti  is  a  signa- 
tory to  the  International  Convention  of  1907,  but  would  support  at 
this  time  the  recommendations  of  the  International  High  Commission 
for  an  inter- American  convention  on  parcel  post,  particularly  fixing 
weights,  adjusting  charges,  regulating  the  size  of  packages,  and  the 
abolition  of  surtaxes. 

4.  Cable  facilities;  wireless  telegraphy. — At  the  present  time  in 
Haiti  there  is  a  single  cable  company  operating  under  an  exclusive 
concession.    There  is  also  a  United  States  Government  wireless  sta- 
tion which  accepts  commercial  messages.    The  rates  on  both  cables 
and  wireless^ messages  are  excessive  and  every  effort  should  be  made 
to  bring  them  to  a  reasonable  basis  as  an  encouragement  to  larger 
commercial   intercourse.      A   strictly   commercial   service    is   much 
needed.    The  Haitian  delegation  strongly  recommends  the  adoption 
of  a  convention  based  upon  the  principles  adopted  at  Buenos  Aires 
in  1916  with  relation  to  the  establishment  of  uniform  telegraph  tar- 
iffs for  American  States  and  cooperation  among  the  States  to  facili- 
tate freer  cable  and  wireless  communication. 

(5)  The  establishment  of  free  ports. — No  proposition  has  hereto- 
fore been  made  or  submitted  for  free  ports,  but  Haiti  would  be  will- 
ing to  consider  any  proposal  which  would  come  to  her  looking  to 
the  establishment  of  a  free  port  and  improved  warehouse  facilities. 

VI.  THE  DEVELOPMENT  OF  UNIFORMITY  OF  LEGISLATION  IN  RELATION  TO  I 

1.  Uniform  customs  regulations;  the  prevention  of  the  under- 
valuation of  merchandise  in  export  and  import  declarations. — The 
conference  committee  agrees  with  the  wish,  expressed  by  the  Haitian 


124  SECOND   PAN   AMERICAN   FINANCIAL.   CONFERENCE. 

delegation,  that  there  should  be  a  uniform  regulation  of  this  matter 
and  that  the  customs  regulations  be  so  improved  as  to  render  trans- 
actions as  simple  as  possible,  and  it  believes  it  is  necessary,  among 
other  things,  that  the  consular  vise  on  the  bill  of  lading  be  dis- 
pensed with  as  well  as  on  the  certificates  of  origin,  and  that  the  only 
consular  vises  required  should  be  on  the  manifest  and  invoice. 

2.  The  Haitian  delegation  believes  that  the  metric  system  should 
be  adopted  in  customs  transactions. 

3.  Contracts  regarding  the  consignment  of  merchandise  in  foreign 
trade  and  the  conditions  of  acceptance  or  rejection  of  merchandise. — 
The  Hague  rules  in  regard  to  such  contracts  have  not  heretofore  been 
carried  out  on  account  of  internal  difficulties,  but  it  is  the  present 
intention  to  include  the  rules  suggested  by  the  International  High 
Commission  in  the  revision  by  Haiti  of  its  commercial  code. 

4.  Commercial  arbitration;  agreements  between  the  chambers  of 
commerce  of  the  American  Republics,  with  special  reference  to  the 
agreements  between  the  Chambers  of  Commerce  of  Buenos  Aires, 
Montevideo,  and  Guayaquil,  and  the  Chamber  of  Commerce  of  the 
United  States. — The  conference  committee  approves  the  resolution  of 
the  Haitian  delegation  in  favor  of  adopting  a  Pan-American  con- 
vention looking  toward  compulsory  arbitration  for  the  settlement  of 
commercial  disputes  based  upon  the  agreement  now  existing  between 
the  Bourse  de  Commerce  of  Buenos  Aires  and  the  Chamber  of  Com- 
merce of  the  United  States. 

5.  Patent  and  copyright  law;  the  protection  of  trade-marks,  espe- 
cially through  the  establishment  of  the  International  Trade-mark 
Bureau  at  Hob  ana  and  Rio  de  Janeiro. — Copyrights  are  regulated 
by  a  law,  adopted  in  Haiti  subsequent  to  the  ratification  of  the  Berne 
convention  of  1884,  the  same  law  governing  registration  of  patents. 
Haiti  also  has  adhered  to  the  Pan-American  copyright  convention 
providing  reciprocal  privileges  among  the  Latin- American  Nations. 

The  Government  of  Haiti  has  adhered  to  and  ratified  the    con- 
vention of  Buenos  Aires  on  the  registration  of  trade-marks  and  the 
law  of  June  9,  1919,  carried  this  ratification  into  effect. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  HAITI, 
FLEURY  FEQUIERE,  Chairman. 
EDWARD  HIDDEN,  Vice  Chairman. 


HONDURAS. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  OF  THE  TREASURY  OF  THE  UNITED 

STATES. 

SIR  :  The  conference  committee  on  matters  pertaining  to  Honduras 
has  the  honor  to  report  the  following  outline  of  conditions  at  pres- 
ent existing  in  Honduras,  an4  which  it  was  the  province  of  your  com- 
mittee to  consider  with  reference  to  the  development  of  the  natural 
resources  of  that  country,  which  might  prove  to  the  mutual  advan- 
tage of  Honduras  and  the  United  States,  if  this  could  be  brought 
about  by  cooperation. 


FACTURING  AND  MINING,  AGRICULTURE,  AND  PUBLIC  UTILITIES  OF  THE 
REPUBLIC  OF  HONDURAS. 

The  general  economic  conditions  of  Honduras  have  not  been  im- 
proved or  stimulated  to  any  appreciable  extent  by  the  World  War. 
While  it  is  true  that  the  exports  of  Honduras  have  steadily  increased 
during  the  years  1913-14,  1914-15,  1915-16,  and  1916-17,  amounting 
in  each  of  such  years,  respectively,  to  the. sums  of  $3,421,331,  $3,458,- 
000,  $4,190,565,  and  $5,353,452,  and  while  it  is  also  true  that  this  in- 
crease has  continued  to  the  present  day,  yet  it  is  also"  true  that  such 
increase  is  rather  in  the  value  of  the  expoi»ts  than  in  the  quantity  and 
volume  of  the  goods  and  products  exported.  Both  the  units  of  pro- 
duction and  the  units  of  export  have  failed  to  increase  during  the 
above  periods,  due  to  many  factors,  some  of  which  will  be  adverted 
to  later ;  but  at  this  time  we  will  note  that  the  lack  of  proper  ship- 
ping facilities  contributed  largely,  not  only  to  the  arresting  of  the 
development  of  many  of  the  natural  resources  of  the  country,  but 
was  instrumental,  in  some  instances,  in  completely  paralyzing  certain 
industries. 

Prior  to  the  advent  of  the  World  War  the  steamers  of  three  steam- 
ship lines  touched  at  the  port  of  Amapala,  on  the  southern  or  Pacific 
coast  of  Honduras,  to  wit,  the  Ward  Line,  the  Cosmos  Line,  and  the 
Pacific  Mail  Steamship  Co.  The  ships  of  the  first  two  companies 
touched  at  Amapala  two  or  three  times  a  month,  while  those  of  the 
last-named  company  maintained  a  fortnightly  service.  During  the 
war  the  Ward  Co.  and  the  Cosmos  Co.  withdrew  their  ships  from  serv- 

125 


126  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

ice  at  the  port  of  Amapala,  a  condition  which  still  exists,  while  the 
Pacific  Mail  Line  has  continued  a  very  irregular  and  unsatisfactory 
service  and  schedule,  its  steamships  touching  at  said  port  sometimes 
once  a  week  and  sometimes  once  a  month. 

Your  committee  is  not  aware  of  the  reason  for  the  above-noted 
irregularity  in  the  schedule  of  this  last-named  company. 

The  withdrawal  of  shipping  facilities,  such  as  they  had  been, 
from  the  port  of  Amapala  resulted  in  the  inability  of  the  people 
who  inhabited  and  cultivated  the  large  southern  zone,  which  natu- 
rally looks  to  that  port  for  purposes  of  exportation,  to  export  any 
perishable  or  semiperishable  products,  and  resulted  also  in  the  com- 
plete stoppage  of  the  exportation  of  timber  through  this  port.  This 
naturally  resulted  in  the  loss  of  much  revenue  to  the  Government 
and  also  to  the  people  engaged  in  such  industries  in  that  particular 
section  of  the  country.  On  the  other  hand,  the  World  War  did  not 
affect  and  has  not  affected  sea-transportation  facilities  between  the 
ports  of  Honduras,  situated  on  the  northern  or  Atlantic  coast,  and  the 
United  States  to  as  great  an  extent  as  on  the  Pacific  coast.  The  ex- 
ports through  the  Atlantic  ports  have  continued  much  the  same  in 
quantity  and  character  as  they  were  prior  to  the  war,  and  their  value 
steadily  increased  in  keeping  with  the  general  advance  in  the  price 
of  commodities  throughout  the  world.  In  a  general  way  it  may  be 
said,  however,  that  what  Honduras  has  gained  in  the  value  of  its  ex- 
ports through  its  Atlantic  ports  it  has  lost  through  the  reduction  in 
quantity  of  its  exports  through  the  port  of  Amapala.  This  condi- 
tion is  susceptible  of  easy  remedy — the  establishment  of  the  proper 
shipping  facilities  at  Amapala,  either  by  allocating  new  ships  to  that 
port  or  by  increasing  the  number  of  ships  of  the  Pacific  Mail  Co. 
which  call  thereat,  and  by  Jiaving  a  regular  and  permanent  schedule 
of.  sailings  therefrom. 

Your  committee,  therefore,  begs  to  report  in  reply  to  inquiry  No. 

I,  Title  I,  that  the  World  War  has  not  resulted  in  any  appreciable 
increase  in  the  development  of  the  domestic  resources  of  Honduras 
so  as  to  create  a  greater  economic  independence. 

As  to  inquiry  No.  2,  Title  I,  in  the  special  case  of  Honduras,  your 
committee  is  of  the  opinion  that  the  answer  thereto  involves  the 
consideration  of  matters  not  within  its  province. 

As  to  inquiry  No.  3,  Title  I,  we  beg  to  refer  to  that  part  of  this 
report  comprehended  under  Title  IV. 

II.  HOW    CAN    REQUIRED    CAPITAL    AND    CREDIT    FACILITIES    BEST    BE    PRO- 

VIDED ? 

Your  committee  begs  to  report,  in  reply  to  inquiries  1  and  2  undei 
this  title,  that  it  is  very  apparent  that  in  Honduras  sufficient  domestic 
capital  is  not  available  for  the  development  of  the  natural  resources- 


REPORT   OP    THE    CONFERENCE    COMMITTEE HONDURAS.       127 

of  the  country,  but  that  the  Government  of  Honduras  is  endeavor- 
ing by  every  fair  and  equitable  means  to  encourage  the  investment 
of  foreign  capital  in  such  development.  The  many  natural  resources 
of  Honduras,  rich  as  it  is  in  minerals,  such  as  gold,  silver,  copper, 
iron,  coal,  marble  quarries,  opals,  platinum,  aluminum,  and  petro- 
leum; and  in  timber  and  valuable  woods,  such  as  cedar,  mahogany, 
balsam,  rosewood,  and  many  other  hardwoods,  offer  a  particularly 
attractive  field  for  the  investment  of  capital.  The  fertile  soil  of  the 
country  makes  it  susceptible  of  easy  cultivation  and  abundant  pro- 
duction, and  Honduras  is  particularly  rich  in  its  grazing  lands, 
making  it  capable  of  supporting  millions  of  live  stock  more  than  at 
present  exist. 

As  to  subdivisions  A,  B,  and  C,  under  inquiry  No.  2  of  Title  II, 
the  committee  reports  that  at  present  Honduras  enjoys  fair  banking 
facilities,  which,  however,  would  have  to  be  improved  and  enlarged 
upon  the  investment  of  any  great  amount  of  capital  in  the  develop- 
ment of  the  resources  of  the  country.  In  this  regard  the  use  of  ac- 
ceptances should  be  inaugurated  and  encouraged,  and  the  Govern- 
ment stands  ready  to  render  encouragement  to  any  improvement 
upon  present  banking  facilities. 

At  present  no  market  exists  in  Honduras  for  the  distribution  of 
foreign  government  and  corporate  securities. 

There  is  no  room  for  the  investment  of  capital  in  foreign  enter- 
prises, as  it  is  required  for  the  home  country  itself. 

I  III.    NATIONAL  CREDIT  AND  THE  FACTORS  AFFECTING  IT. 

Referring  to  inquiry  No.  1  under  this  title,  your  committee  is 
pleased  to  report  that  the  condition  of  the  internal  debt  of  Honduras 
is  satisfactory  and  is  improving,  having  undergone  a  reduction  since 
1914.  In  regard  to  the  external  debt  of  Honduras,  the  committee  is 
again  of  the  opinion  that  this  involves  consideration  of  matters  not 
within  its  province. 

Inquiry  No.  2 :  Honduras  is  working  under  a  good  budget  system. 
Its  sources  of  revenue  are  duties  on  imports  and  exports,  with  a  5 
per  cent  (gold)  surtax  on  imports  and  there  also  exists  a  system  of 
excise  and  personal  taxes.  The  net  revenue  of  the  country  has  de- 
creased practically  $1,000,000  between  1914-15  and  1917-18,  owing 
largely  to  insufficient  shipping  facilities. 

As  to  inquiry  No.  3  of  this  title,  it  is  the  constant  effort  of  the 
Government  of  Honduras  to  place  the  country  upon  as  solid  a  finan- 
cial basis  as  possible,  to  have  it  harmonize,  as  far  as  practicable,  with 
the  fiscal  systems  which  obtain  in  the  other  countries  of  America. 
Toward  this  end  Honduras  has  declared  United  States  currency  legal 


128  SECOND  PAN  AMERICAN   FINANCIAL,  CONFERENCE. 

tender,  at  the  rate  of  exchange  of  2  to  1,  and  Honduras  to-day  is 
practically  upon  a  gold  basis. 

As  to  inquiry  No.  4,  the  committee  finds  that  the  Provinces  of 
Honduras  are  not  empowered  to  create  debts,  but  that  the  munici- 
palities may  contract  loans  with  the  approval  of  the  General  Govern- 
ment. The  principal  and  interest  of  such  loans  is  provided  for  under 
the  general  taxing  powers  of  the  municipal  government. 

IV.    THE  EFFECT  OF  THE  WAR  ON  TRANSPORTATION  FACILITIES;   REQUIRE- 
MENTS OF  THE  PRESENT  AND  IMMEDIATE  FUTURE. 

As  to  No.  1,  the  committee  believes  it  has  fully  set  forth  the  facts 
pertinent  thereto  in  its  statement  under  Title  I,  in  so  far  as  sea  trans- 
portation is  concerned.  As  to  No.  2,  it  is  the  opinion  of  the  delegates 
from  Honduras,  and  your  committee  concurs  in  the  same,  that  for  the 
present  there  is  nothing  to  suggest  in  this  regard.  As  to  No.  3,  your 
committee  can  speak  generally  as  to  the  great  importance  of  this 
topic,  but  has  no  specific  recommendation  to  submit  in  regard  to 
Honduras,  other  than  the  presentation  of  actual  conditions  in  that 
country  respecting  land  transportation  and  the  crying  need  for  its 
immediate  development. 

If  an  opportunity  is  to  be  given  to  the  inhabitants  of  Honduras 
to  develop  the  many  rich  and  natural  resources  of  the  country,  it 
is  essentially  necessary  that  there  exist  a  trunk  line  or  road  con- 
necting the  coast  on  the  Atlantic  side  with  the  coast  on  the  Pacific 
side.  At  present  there  exists  an  excellent  macadam  road  between 
the  capital  city  of  Tegucigalpa  and  San  Lorenzo,  on  the  Bay  of  Fon- 
seca,  thus  giving  the  capital  access  to  the  port  of  Amapalpa,  on  the 
Pacific.  From  the  city  of  Tegucigalpa  northward  in  the  general  di- 
rection of  Puerto  Cortes,  there  is  an  excellent  macadam  road  as  far 
as  the  town  of  Comayagua,  a  distance  of  about  100  miles.  From 
Puerto  Cortes  there  exists  a  railway,  the  Ferrocarril  Nacional,  run- 
ning as  far  as  La  Pimienta,  a  distance  of  about  56  miles.  By  con- 
necting La  Pimienta  with  the  terminus  of  the  macadam  road  at 
Comayagua  by  means  of  the  construction  of  a  macadam  road  be- 
tween these  two  places,  the  much-desired,  long-prayed-for,  and  im- 
peratively required  trunk  line  from  coast  to  coast  would  become  a 
reality,  and  Honduras  would  be  placed  in  a  position  which  would 
make  it  possible  for  its  people  to  develop  the  natural  resources  of 
the  country — an  opportunity  never  before  enjoyed.  This  road  be- 
tween La  Pimienta  and  Comayagua,  the  building  of  which  is  urgently 
recommended  by  your  committee,  would  be  about  135  miles  in  length. 
Its  construction  is  just  as  important,  in  the  opinion  of  your  com- 
mittee, to  the  development  and  progress  of  the  commerce  and  life 
of  Honduras  as  the  improvement  of  shipping  facilities.  It  is  abso- 


REPORT    OF    THE    CONFERENCE    COMMITTEE HONDURAS.       129 

lutely  necessary,  in  connection  with  the  establishment  of  steamship 
facilities,  to  provide  good  roads  in  the  interior  and  all  facilities  at 
the  ports  for  loading  and  unloading.  We  summarize  this  by  saying : 

Necessity  No.  1.  Excellent  interior  macadam  roads  for  the  trans- 
portation of  products  to  the  ports ; 

Necessity  No.  2.  Improved  shipping  facilities  at  Atlantic  and  Pa- 
cific ports ; 

Necessity  No.  8.  All  necessary  facilities  for  loading  and  unloading. 

In  this  connection  the  committee  incorporates  the  following  reso- 
lution which  was  adopted  at  its  conference : 

Resolved,  That  it  is  the  sense  of  this  committee  sitting  on  the 
-  affairs   of  Honduras  to  state  their  position  in  the   following 
manner : 

We  consider  it  an  imperative  duty  on  the  part  of  the  United 
States  and  its  citizens  to  give  every  possible  encouragement  to 
the  establishment  of  a  steamship  line  between  the  United  States 
and  Central  and  South  American  countries.  We  consider  these 
steamship  lines  shall  be  organized,  in  the  first  place,  for  the  pro- 
motion of  personal  travel,  so  as  to  allow  the  citizens  of  all  coun- 
tries to  become  personally  acquainted  with  the  features  of  the 
respective  countries;  and  in  the  second  .place,  we  consider  it 
of  the  utmost  importance  that  the  commercial  intercourse  be 
promoted  in  every  possible  way  between  the  countries  of  Central 
and  South  America  and  the  United  States. 

We  regard  this  step  as  not  only  important  for  the  interests 
of  the  Central  and  South  American  countries,  but  as  import- 
ant for  the  manufacturing  and  commercial  interests  of  the 
United  States. 

Important  facilities  for  the  interchange  of  commodities  between 
the  respective  countries  are  very  essential  for  friendly  and  profitable 
relationship  between  all  our  countries. 

However,  we  can  not  but  recognize  that  the  promotion  of  steamship 
facilities  is  a  vain  act  if  conditions  in  a  country  are  such  as  to  make 
it  impossible  for  that  nation  to  transport  its  products  to  the  ports 
for  exportation.  Hence,  having  in  mind  the  special  conditions  which 
now  obtain  in  Honduras,  we  heartily  concur  in  and  adopt  the  follow- 
ing recommendation  presented  by  the  delegates  from  Honduras  to 
the  Committee  of  Transportation. 

1.  With  the  purpose  of  making  effective  such  water  transpor- 
tation facilities  as  may  now  or  in  the  future  exist  in  connection 
with  the  commercial  intercourse  between  our  country  and  the 
United  States  of  America  and  other  nations,  we  believe  that 
facilities  for  land  communication  should  be  developed  simulta- 
14970—21 9 


130  SECOND  PAN   AMERICAN   FINANCIAL  CONFERENCE. 

neously,  for  without  the  latter  facilities  for  maritime  transporta- 
tion such  as  this  conference  had  in  mind  would  avail  us  little. 

Therefore,  having  in  mind  the  peculiar  circumstances  or  con- 
ditions of  our  country,  its  small  population,  and  consequently  its 
small  production,  it  would  not  be  possible  for  it  to  construct  and 
maintain  railway  lines  which  require  an  investment  of  large 
amounts  of  capital  for  their  construction,  and  a  large  quantity 
of  traffic  for  their  maintenance  or  support;  therefore  the  dele- 
gation from  Honduras  is  of  the  opinion  that  for  the  present  it 
should  limit  its  aspirations  in  this  regard  to  the  construction  of 
good  roads,  which  would  permit  the  development  of  the  natural 
resources  of  the  different  sections  of  the  country,  and  which 
would  give  exit  to  the  products  of  the  country  to  foreign  markets. 
In  order  to  realize  this  object,  our  Government  would  study  a 
comprehensive  plan  of  the  various  routes  which  would  be  opened 
in  order  to  place  in  communication  with  each  other  the  different 
sections  of  the  interior  with  ports  and  would  accept  any  equitable 
.  arrangement  for  acquiring  funds  necessary  for  this  purpose. 

2.  With  reference  to  the  maritime  service  or  transportation, 
this  delegation  suggests  the  necessity  for  improvement  on  the 
Pacific  literal  or  coast  of  our  country  by  increasing  the  number 
of  steamships  of  the  present  line  or  by  establishing  a  new  line, 
so  that  there  may  be  a  fixed  and  permanent  schedule  of  at  least 
weekly  sailings  between  Panama,  Amapala,  and  San  -Francisco, 
and  further  there  should  be  established  a  line  of  steamships  with 
direct  sailings  between  New  York  and  the  various  ports  of  the 
northern  or  Atlantic  coast  of  Honduras. 

The  committee  is  strongly  of  the  opinion  that  proper  measures 
should  be  taken  as  soon  as  possible  looking  to  the  linking  up  of  the 
present  gap  between  the  terminus  of  the  National  Railroad  and  the 
macadam  road  (carretera)  running  from  Tegucigalpa  toward  the 
Atlantic  coast,  thus  connecting  the  port  of  Puerto  Cortes,  on  the 
Atlantic  coast,  with  the  port  of  Amapala,  on  the  Pacific  coast,  by  a 
central  highway  or  trunk  line. 

The  great  possibilities  which  seem  apparent  in  the  country  of 
Honduras  after  development  of  its  railroads  and  its  country-road 
facilities  will  find  their  proper  outlets  when  sufficient  shipping  facili- 
ties have  been  allocated  to  the  ports  on  the  Pacific,  as  well  as  the 
Atlantic  Ocean  sides.  In  making  this  recommendation  we  desire 
to  say  that  it  is  useless  to  duplicate  facilities  on  the  Atlantic  Ocean 
side,  but  to  give  every  possible  attention  to  the  increase  of  facilities 
on  the  Pacific  Ocean  side,  particularly  at  the  port  of  Amapala,  and 
we  recommend  that  regular  sailing  and  permanent  schedules  be  estab- 
lished, so  as  to  foster  the  enlargement  of  the  trade  between  Honduras 
and  the  United  States. 


REPORT   OF    THE    CONFERENCE    COMMITTEE HONDURAS.       131 

The  committee  tenders  its  hearty  support  to  the  plan  which  is 
being  considered  for  establishing  a  Pan  American  railroad  through 
Central  and  South  America  and  the  building  of  a  link  for  this  rail- 
road across  Honduras,  crossing  through  the  towns  of  Nacaome  and 
Choluteca. 

V.  MEASURES     TO     FACILITATE     COMMERCIAL     INTERCOURSE     AMONG     THE 

AMERICAN  REPUBLICS. 

As  to  No.  1  under  this  title,  the  committee  finds  that  laws  and 
regulations  referring  to  commercial  travelers  at  present  existing  are 
entirely  satisfactory.  As  to  No.  2,  the  committee  wishes  to  express 
its  approval  of  the  establishment  of  an  international  gold  clearance 
fund.  As  to  No.  3,  the  committee  suggests  that  every  possible 
facility  be  given  by  the  postal  department  to  the  establishment  of 
low  postal  rates  for  parcel  post  facilities,  as  well  as  regular  postal 
rates  for  mail  dispatch,  in  order  to  increase  in  every  possible  way 
the  business  relations  between  Honduras  and  the  United  States,  and 
this  committee  further  recommends  the  adoption  of  an  international 
return  postage  stamp  system  instead  of  the  existing  coupon  system. 
As  to  No.  4,  the  committee  strongly  recommends  that  the  establish- 
ment of  wireless,  cable,  and  telegraphic  facilities  for  the  public  trans- 
mission of  messages  on  lines  that  would  best  promote  the  commer- 
cial and  social  intercourse  between  nations  and  their  citizens  should 
be  encouraged  by  all  Governments.  As  to  No.  6,  the  committee  takes 
pleasure  in  reporting  that  the  warehouse  facilities  are  considered 
sufficiently  good. 

VI.  THE  DEVELOPMENT  OF  UNIFORMITY   OF  LEGISLATION   IN  RELATION  TO 

UNIFORM   CUSTOMS   REGULATIONS,   ETC. 

As  to  No.  1,  your  committee  is  informed,  and  so  begs  to  report,  that 
the  Government  of  Honduras  stands  ready  to  cooperate  by  every 
means  in  its  power  in  the  adoption  of  laws  and  regulations  calcu- 
lated to  bring  about  uniformity  of  customs  regulations.  So  far  as 
the  State  of  Honduras  is  concerned,  its  tariff  laws  are  uniform 
throughout  the  country  and  its  tariff  duties  are  not  based  upon  the 
ad  valorem  system,  but  rather  on  the  weights  and  measures  system,, 
leaving  but  little  opportunity  for  the  undervaluation  of  merchan- 
dise, either  in  export  or  import  declarations. 

As  to  No.  2,  your  committee  suggests  that  it  is  highly  desirable 
that  Honduras  adopt  the  United  States  negotiable  instruments  act 
and  suitable  rules  and  regulations  similar  to  those  of  the  United 
States  and  some  Central  and  South  American  Republics  in  regard 
to  bills  of  lading  and  warehouse  receipts. 


132  SECOND   PAX    AMEEICAX    FINANCIAL,   CONFERENCE. 

As  regards  No.  3,  the  committee  reports  that  it  is  of  the  opinion 
that  the  existing  laws  of  Honduras  with  reference  to  contracts 
regarding  consignments  of  merchandise  and  foreign  trade  and  the 
conditions  of  acceptance  or  rejection  of  the  same  are  fair  and  just, 
and  that  the  Government  has  always  shown  a  willingness  to  coop- 
erate in  the  adoption  of  any  law  tending  to  promote  trade  and 
justice  in  commerce. 

As  to  No.  4,  the  committee  recommends  that  Honduras  place 
itself  as  speedily  as  possible  in  line  with  the  system  adopted  by 
the  Chambers  of  Commerce  of  Buenos  Aires,  Montevideo,  and 
Guayaquil  and  the  Chamber  of  Commerce  of  the  United  States 
concerning  commercial  arbitration. 

As  to  No.  5,  your  committee  finds  that  in  regard  to  patent  and 
copyright  law  and  the  protection  of  trade-marks,  Honduras  has 
joined  the  International  Trade-Mark  Bureau  of  Habana,  and  it 
recognizes  the  importance  of  protection  for  inventors  and  owners 
of  copyrights  and  trade-marks  in  the  States  of  Honduras  and  the 
United  States. 

As  to  No.  6,  the  committee  reports  that  its  information  is  that 
the  existing  admiralty  laws,  in  so  far  as  Honduras  is  concerned, 
are  entirely  satisfactory,  and  that  it  has  been  unable  to  learn  of  any 
instance  in  which  they  have  proven  unsatisfactory. 

Your  committee  further  begs  to  report  that  it  has  adopted  the  fol- 
lowing resolution : 

At  the  suggestion  of  the  Director  General  of  the  Pan  American 
Union,  the  committee  recommends  that- 
First.  Each  Government  of  the  Pan  American  Union  shall 
arrange  that  regularly  and  permanently  its  various  departments 
and  bureaus  shall  deposit  in  the  library  of  the  Pan  American 
Union  two  copies  of  all  informative  official  publications,  maps, 
and  other  data. 

Second.  That  each  Government  consider  the  advisability  of 
preparing  under  its  direction  a  comprehensive  standard  hand- 
book in  English  describing  its  financial,  commercial,  material, 
and  other  conditions,  to  be  distributed  through  the  Pan  Ameri- 
can Union. 

Third.  That  each  Government  deposit  in  the  Pan  American 
Union,  for  exhibit  whenever  necessary,  films  descriptive  of  its 
life  and  resources. 

Fourth.  That  every  effort  be  made  by  each  Government  to 
make  the  Pan  American  Union  a  practical,  up-to-date  central 
bureau  of  information. 

Your  committee  is  of  the  opinion  that  the  problems  of  Honduras 
do  not  appear  difficult  of  solution.  In  many  respects  they  are  similar 


REPORT   OF    THE    CONFERENCE    COMMITTEE HONDURAS.       133 

to  those  of  other  Central  American  countries.  All  can  be  settled 
expeditiously  and  effectively  under  the  impetus  of  a  comprehensive 
plan  of  development  energetically  carried  forward  and  sustained  by 
the  rich  resources  of  these  countries  and  by  the  splendid  devotion 
of  their  peoples  to  the  advancement  and  welfare  of  their  respective 
nations. 

It  has  been  suggested,  however,  that  there  is  something  more  im- 
portant at  this  time  to  assure  the  establishment  of  enduring  busi- 
ness relations  between  North  and  South  and  Central  America,  in- 
cluding the  West  Indian  countries,  than  purely  material  aid.  This 
something  more  is  unquestionably  a  closer  fraternal  relationship,  a 
better  understanding  and  higher  appreciation  of  the  manners  and 
customs  of  Latin  Americans  and  an  unreserved  acceptance  thereof 
as  essential  to  unrestrained  social  and  commercial  intercourse. 

We  recognize  the  peoples  of  these  countries  as  worthy  of  the  high- 
est respect  and  profoundest  admiration.  Their  dignity,  intellec- 
tuality, industry,  and  patriotism  have  won  for  them  the  warmest 
regard  and  fullest  confidence  of  the  peoples  with  whom  they  have 
been  brought  into  more  intimate  relations.  We  submit  that  it  is 
necessary  to  the  strengthening  of  the  present  association  of  the  north 
and  the  south  that  this  subject  be  given  careful  consideration,  and 
that  a  more  respectful  attitude  be  substituted  for  the  indifference 
too  often  manifested  toward  the  southern  peoples. 

As  a  means  to  this  end  we  recommend  that  the  characteristics 
of  Latin  American  life  be  made  a  topic  of  special  study  in  the 
schools  and  colleges  of  the  United  States,  and  that  the  Govern- 
ment of  the  United  States  cooperate  with  the  Latin  American 
Republics  in  establishing  at  some  suitable  place  a  Pan  American 
University,  where  students  from  the  United  States  and  students 
from  Latin  American  countries  can  be  brought  into  intimate 
association  and  receive  the  fullest  instruction  in  all  matters  per- 
taining to  their  respective  nations. 

Your  committee  has  refrained  from  entering  into  statistical  matter 
and  data,  as  it  is  available  in  numerous  pamphlets  and  books  on 
Honduras  on  file  at  the  Pan  American  Union  Building,  which  any- 
one interested  in  the  subject  may  secure. 

The  undersigned  committee  unanimously  submits  this  report  to 
the  Pan  American  Financial  Conference  and  recommends  that  it  be 
referred  for  further  consideration  and  action  to  whatever  body  is 
created  or  may  already  exist  for  the  purpose  of  giving  effect  to  the 
proceedings  of  this  conference. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  HONDURAS, 
JUAN  E.  PAREDES,  Chairman, 
JOHN  W.  THOMAS,  Vice  Chairman. 


MEXICO. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  OF  THE   TREASURY   or  THE  UNITED 

STATES. 
SIR  :  Your  committee  has  the  honor  to  submit  the  following  report : 

ORGANIZATION. 

* 

The  organization  of  the  Mexican  conference  committee  was  ef- 
fected at  its  first  meeting  by  the  election  of  Mr.  K.  S.  Brookings  as 
permanent  chairman.  Mr.  Brookings  invited  his  excellency  Am- 
bassador Bonillas  to  act  as  chairman  of  the  conference,  which  Mr. 
Bonillas  declined  to  do.  At  the  suggestion  of  the  ambassador  from 
Mexico,  the  proceedings  followed  in  accordance  with  the  final 
program. 

EFFECT  OF  THE  WAR  ON  MEXICO'S  TRADE. 

The  war  considerably  restricted  the  imports  of  Mexico,  making 
her  more  extensively  dependent  upon  the  United  States.  At  the 
same  time,  Mexico  wras  obliged  to  market  her  output  almost  exclu- 
sively in  the  United  States,  owing  to  the  shortage  of  transportation 
facilities.  The  cutting  off  of  her  exports  seriously  hampered  her 
agricultural  development.  The  restrictions  of  the  War  Trade 
Board,  and  especially  those  inspired  by  the  enemy  trading  list,  had 
the  effect  of  reducing  her  commerce,  and  at  the  same  increased  the 
difficulties  attendant  upon  trade.  It  was  shown  effectively  that  the 
real  cause  of  Mexico's  difficulties  during  the  war  lay  in  the  fact  that 
she  did  not  have  an  adequate  merchant  marine  of  her  own. 


SEA    TRANSPORTATION. 


An  address  was  given  by  Dr.  Carbajal  on  sea  transportation, 
showed  that  owing  to  lack  of  material  resources  Mexico's  shipping 
facilities  had  never  been  sufficiently  developed,  consequently  the  war 
found  a  great  scarcity  of  ships  plying  between  Mexico  and  the 
United  States.  The  result  of  these  conditions  was  that  land  trans- 
134 


REPORT   OF   THE    CONFERENCE    COMMITTEE MEXICO.  135 

portation  was  resorted  to  more  extensively  than  ever  before,  and 
what  overseas  shipping  was  carried  on  was  done  almost  entirely  by 
such  American  ships  as  were  allocated  to  the  Mexican  runs  and  by 
foreign  ships.  Mr.  Carbajal  described  the  service  at  present  existing 
on  the  east  and  west  coasts  of  Mexico,  showing  that  all  lines  are  for- 
eign with  the  exception  of  two  or  three  insignificant  Mexican  com- 
panies with  an  aggregate  tonnage  of  about  45,000.  Mr.  Carbajal  ex- 
pressed regret  that  Mr.  John  Barton  Payne,  in  his  address  of  last 
evening,  said  nothing  which  foretold  any  considerable  development 
of  Mexican  shipping  or  any  intention  on  the  part  of  the  American 
Shipping  Board  to  give  Mexico  any  better  service.  Mr.  Carbajal 
suggested  the  desirability  of  the  establishment  of  a  service  through 
the  Panama  Canal  connecting  the  Gulf  of  Mexico  with  the  Pacific. 
At  present,  passengers  from  Mexico  for  Pacific  ports  find  it  neces- 
sary to  go  to  the  United  States  in  order  to  obtain  a  boat  for  the 
Pacific  coast  of  Mexico.  In  view  of  the  fact  that  96  per  cent  of 
Mexico's  trade  is  with  the  United  States,  Mr.  Carbajal  felt  justified 
in  recommending  that  the  United  States  give  special  attention  to 
Mexico's  needs.  The  speaker  also  showed  that  there  is  a  higher 
proportionate  freight  rate  between  Mexican  and  American  ports 
than  between  American  ports  and  other  ports  of  the  world.  He 
showed  that  the  rate  between  Salina  Cruz  and  San  Francisco  is 
higher  than  the  combined  railroad  and  steamship  rate  between  Chi- 
cago and  Yokohama.  Mr.  Carbajal  stated  that  one  of  the  causes  of 
the  high  freight  rate  charge  on  goods  shipped  to  Mexico  was  the  fact 
that  American  railroads  quote  local  rates  for  shipments  to  Mexico 
rather  than  through  rates.  Mr.  Carbajal  discused  the  subject  of 
the  coastwise  trade,  showing  the  necessity  of  developing  same  and 
pointing  out  the  dependence  of  this  trade  on  international  commerce, 
it  being  true,  he  said,  that  goods  can  not  be  exported  when  there  are 
no  local  boats  available  to  carry  goods  from  the  smaller  ports  to 
exporting  ports.  Mr.  Carbajal  pointed  out  that  there  was  a  good 
field  for  American  enterprise  in  the  Mexican  coastwise  trade,  but 
that  in  order  to  go  into  this  business  it  is  necessary  for  a  foreign 
company  to  incorporate  under  the  Mexican  law,  since  foreign  ships 
are  only  permitted  to  carry  goods  between  the  international  ports 
of  Mexico. 

RAILROAD  TRANSPORTATION. 

Mr.  Sobral  briefly  discussed  the  railroad  situation  in  Mexico,  point- 
ing out  that  about  70  per  cent  of  the  traffic  between  Mexico  and  the 
United  States  is  carried  by  rail.  Fifty-one  per  cent  of  the  total  capi- 
tal invested  in  the  Mexican  railroads  is  controlled  by  the  Government. 


136  SECOND   PAN   AMEKICAN    FINANCIAL.   CONFERENCE. 

The  gross  earnings  of  Mexican  railroads  for  the  following  typical 
years  is  given  by  Mr.  Sobral : 

Gold  pesos. 

1918 : 66,  000, 000 

1908 53,  000,  000 

1910 61,  000,  000 

1911 62,  000, 000 

1912 61.  000,  000 

PUBLIC  DEBT. 

At  the  afternoon  session  of  Tuesday,  January  20,  Dr.  Sobral  dis- 
cussed the  financial  situation  of  Mexico  and  the  means  of  funding 
the  Mexican  public  debt.  He  outlined  the  various  items  of  the  na- 
tional debt,  these  being  mainly  the  original  foreign  loans  to  the  Gov- 
ernment with  interest  pledged  on  same,  fiat  paper  money,  indebted- 
ness covering  the  reserves  of  banks  seized  by  the  Government,  losses 
caused  to  individuals  by  the  revolution,  and  debts  incurred  by  Madero 
and  Huerta.  He  estimated  the  total  public  debt  of  Mexico  at  894,- 
130,000  pesos  Mexican  gold. 

This  debt  is  guaranteed  by  62  per  cent  of  the  total  customs  duties, 
but  this  part  of  Mexico's  obligations  has  not  been  met.  So  impor- 
tant is  it  considered  that  Mexico  should  make  a  beginning  in  the 
payment  of  her  debt  that  for  1920  she  has  set  aside  the  sum  of  10,- 
000,000  pesos  to  be  paid  thereon. 

FEDERAL  REVENUES. 

The  import  and  export  duties  aggregate  49,000,000  pesos  a  year. 
The  Mexican  export  duty  is  a  new  emergency  source  of  income,  origi- 
nating with  the  needs  of  the  Carranza  Government.  Consular  fees 
aggregate  6,000,000  pesos  a  year,  and  other  sources  of  federal  income 
are  the  stamp  tax  on  gross  sales,  the  inheritance  tax,  tobacco  tax,  tax 
on  alcoholic  beverages,  tax  on  cotton  manufactured  products  and  sil- 
ver. The  petroleum  tax  in  1918  yielded  14,000,000  pesos,  and  8,000,000 
for  the  first  six  months  of  1919.  A  mining  royalty  tax  yielded 
2,000,000  pesos.  The  total  estimate  for  federal  revenues  in  1920  is 
170,000,000  pesos.  The  largest  single  item  of  expenditure  of  the  Mex- 
ican Government  is  for  naval  and  military  defense,  on  which,  in  1919, 
120,000,000  pesos  were  spent. 

The  revenues  of  Mexico  have  not  been  adequate  to  pay  the  national 
debt,  nor  are  they  even  adequate  to  meet  guaranteed  expenses,  as  is 
shown  by  the  fact  that  the  salaries  of  Government  officials  and  em- 
ployees in  Mexico  are  not  paid  in  full,  only  f 5  per  cent  of  same  being 
so  paid,  the  remaining  25  per  cent  being  given  employees  in  nontrans- 
ferable  Government  bonds,  the  holders  of  which  thus  become  creditors 
of  the  nation. 


REPORT   OF   THE    CONFERENCE   COMMITTEE MEXICO.  137 

FINANCIAL  NEEDS  OF  MEXICO. 

Mr.  Sobral  enumerated  what  he  considered  as  the  most  urgent 
financial  needs  of  Mexico,  which  are — 

1.  The  establishment  of  a  sole  bank  of  issue, 

2.  The  establishment  of  a  mortgage  bank,  and 

3.  The  creation  of  an  agricultural  bank  to  establish  rural  credits. 
The  aggregate  of  these  three  propositions  presents  a  requirement  of 

1,000,000,000  pesos.  The  example  of  the  United  States,  however,  in 
the  creation  of  its  successful  Federal  Reserve  System,  with  an  initial 
capital  of  $50,000,000,  which  has  since  grown  to  have  a  paid-up  capi- 
tal of  $75,000,000,  was  urged  by  Mr.  Williams  as  a  possible  proof  that 
the  banking  needs  of  Mexico  did  not  require  so  extensive  a  sum  as 
Mr.  Sobral  estimated. 

Other  needs  are  the  construction  oi  railroads  from  Yucatan  to' 
Tehuantepec,  Mexico  City  to  Pacific  ports,  and  harbor  improvements 
at  such  points  as  Progreso,  Tuxpan,  and  Tampico. 

So  impressed  was  the  group  conference  with  Mr.  Sobral's  presen- 
tation of  the  financial  needs  of  Mexico  that  it  was  resolved  that  he 
be  requested  to  present  this  subject  to  the  general  conference  in  an 
address  of  not  less  than  20  minutes'  duration  on  Thursday  afternoon, 
January  23. 

MEANS  FOR  FACILITATION  OF  COMMERCIAL  INTERCOURSE  BETWEEN  UNITED 

STATES  AND  MEXICO. 

Ambassador  Bonillas  expressed  the  opinion  that  Mexico  would  be 
willing  to  enter  into  arrangements  with  the  United  States  Govern- 
ment with  a  view  to  having  the  wireless  service  between  the  two 
countries  placed  on  a  commercial  basis.  A  resolution  was  adopted 
by  the  group  committee  to  the  effect  that  the  Governments  of  the 
United  States  and  Mexico  be  requested  to  give  consideration  to  the 
development  of  a  wireless  telegraph  service  between  the  two  nations 
for  the  purpose  of  assisting  commercial  intercourse. 

MEXICAN    MONETARY    SITUATION. 

The  increase  in  the  price  of  silver  has  driven  the  old  silver  coins 
out  of  circulation,  including  the  old  pesos,  the  50-centavo  coins,  the 
20-centavo  coins,  and  the  10-centavo  pieces,  respectively.  On  advice 
from  an  American  authority  the  Mexican  Government  adopted  a  new 
system  of  coinage,  with  a  view  to  reducing  the  amount  of  pure  silver 
contained  in  the  coins,  so  as  to  make  their  real  value  inferior  to  their 
commercial  value  and  thus  retain  them  in  the  country.  The  steadily 
increasing  value  of  silver  forced  the  Mexican  Government  to  alter  the 


138  SECOND   PAN   AMERICAN   FINANCIAL,   CONFERENCE. 

percentage  of  silver  contained  in  her  coinage  in  1917,  1918,  and  1919, 
respectively.  Mr.  Sobral  stated  that  the  question  of  retaining  silver 
coinage  in  Mexico  constituted  a  real  problem  because  the  future 
status  and  value  of  silver  is  uncertain,  and  the  employment  of  small 
gold  coins  has  not  been  found  satisfactory. 

Mr.  Williams  was  called  upon  to  discuss  the  silver  situation  in  the 
United  States  and  to  make  any  suggestion  which  might  be  of  assist- 
ance to  the  Mexican  delegation.  He  stated  the  belief  that  this  prob- 
lem would  probably  be  solved  by  the  great  increase  in  the  produc- 
tion of  silver  all  over  the  world,  as  a  result  of  the  present  high  price 
of  the  metal. 

In  view  of  the  desirability  of  meeting  the  Avorld's  present  demand 
for  silver,  Mr.  Williams  urged  the  necessity  of  a  continuance  of  the 
maximum  production  of  silver  in  Mexico  as  a  real  solution  of  the 
problem.  He  stated  frankly  that  the  United  States  is  looking  to 
Mexico  for  help  in  this  matter,  adding  that  he  knew  of  no  country 
that  had  as  great  possibilities  in  that  regard. 

The  question  of  free  ports  in  Mexico  was  then  discussed,  Mr. 
Sobral  stating  that,  properly  speaking,  Mexico  does  not  have  free 
ports,  but  that  there  are  general  warehouses  wherein  merchandise 
can  be  accepted,  held,  and  reexported  without  paying  duties. 

The  question  of  Mexican  consular  invoice  fees  was  also  referred 
to,  the  complaint  being  repeated  that  they  are  very  large  and 
practically  amount  to  a  tax  upon  every  import  into  the  country. 
There  is  also  a  system  of  fines  which  exposes  American  exporters  to 
very  serious  losses  if  there  be  error  in  the  consular  invoices.  Mr. 
Sobral  admitted  that  Mexican  consular  fees  are  very  high,  which  he 
stated  was  a  measure  imposed  upon  his  country  from  sheer  necessity, 
but  which  he  regarded  as  temporary.  He  promised  to  communicate 
this  criticism  to  the  secretary  of  the  treasury  of  Mexico  and  to  sug- 
gest the  advisability  of  minimizing  these  difficulties. 

FOREIGN    INVESTMENTS    IN    MEXICO,    THEIR    PRESENT    STATUS    AND    THEIR 

FUTURE. 

Mr.  Sobral  explained  the  Mexican  policy  of  concessions,  stating 
that  Mexico  is  especially  inclined  to  foster  those  investments  which 
will  develop  her  future  possibilities.  He  stated  that  Mexico  has 
always  followed  the  policy  of  seeking  foreign  capital;  that  Mexico 
had  come  to  realize  that  investment  is  no  longer  an  end  in  itself,  but 
an  instrument  designed  to  bring  about  better  conditions ;  that  Mexico 
was  inclined  at  all  times  to  grant  to  investors  not  only  full  rights 
under  the  law  but  also  protection,  and  to  go  to  considerable  sacri- 
fice to  foster  investments  which  contribute  to  the  development  of  her 
natural  resources. 


REPORT   OF   THE   CONFERENCE    COMMITTEE MEXICO.  139 

The  classes  of  investments  are:  (1)  Agricultural,  (2)  transporta- 
tion, (3)  banking,  (4)  commercial. 


BANKING  CONDITIONS. 

Mr.  Sobral  called  especial  attention  to  the  liberality  of  the  attitude 
of  the  Mexican  Government  toward  banks.  The  law  of  Mexico  is  no 
respecter  of  persons,  no  license  is  required  to  operate,  and  all  that  the 
Government  concerns  itself  with  is  that  the  investor  complies  with 
the  law  that  exists. 

The  following  limitations  are  placed  by  the  Government  upon  the 
banks : 

1.  A  deposit  of  30  to  40  per  cent  reserve  is  required. 

2.  The  policy  of  the  Government  is  to  supervise  the  bank,  with  the 
object  of  protecting  investors. 

3.  The  Government  guarantees  publicity  and  inspects  the  bank's 
account. 

MINING  INVESTMENTS. 

Mr.  Sobral  stated  that  mining  is  a  natural  industry  which  is 
profitable  to  foreign  investors,  but  proceeded  no  further  with  the 
discussion. 

EDUCATION. 

No  figures  were  given  as  to  the  number  of  students  in  the  schools, 
nor  the  amount  of  money  expended  for  education  by  them ;  the  great 
drawback  connected  with  the  educational  system  of  Mexico  is  that  an 
intellectual  and  social  structure  can  not  be  built  successfully  when 
the  economic  condition  of  the  student  or  teacher  is  unsatisfactory. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  MEXICO, 
YGNACIO  BONILLAS,  Honorary  Chairman. 
ROBERT  S.  BROOKINGS,  Chairman. 


NICARAGUA. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  OF  THE  TREASURY  OF  THE  UNITED 

STATES. 
SIR  :  Your  committee  has  the  honor  to  submit  the  following  report : 

I.  EFFECTS  OF  THE  WAR. 

The  war  stimulated  greatly  the  development  of  the  various  natural 
resources  of  Nicaragua,  such  as  the  natural  woods,  the  castor  bean, 
corn,  sugar,  etc. 

These  increased  developments  have  naturally  tended  toward  greater 
economic  independence. 

Owing  to  the  loss  of  the  European  markets  after  the  United  States 
entered  the  war,  the  price  of  coffee  was  so  lowered  that  it  approxi- 
mated the  cost  of  production,  so  that  at  this  period  the  war  tended 
strongly  to  delay  the  development  in  that  field.  Likewise,  for  a  short 
period,  the  embargo  on  hides  and  skins  lessened  the  revenue  and 
caused  considerable  loss  on  the  part  of  cattle  men  and  shippers.  Since 
the  signing  of  the  armistice,  however,  the  conditions  have  stimulated 
production. 

II.    TRANSPORTATION. 

The  chief  problem  of  Nicaragua  at  the  present  time  is  the  develop- 
ment of  a  general  system  of  good  roads,  railroads,  and  inland  water- 
ways. In  view  of  the  financial  situation  of  Nicaragua,  it  seems  clear 
that  they  can  finance  a  bond  issue  of  $5,000,000  for  railroad  construc- 
tion. The  Government  proposal,  which  we  recommend,  of  a  rail- 
road between  Lake  Nicaragua  and  the  Atlantic  coast  would  afford 
means  by  which  the  Pacific  and  Atlantic  coasts  would  be  connected 
through  railroad  and  water  transportation. 

The  financial  condition  and  future  prospects  of  Nicaragua  are  such 
as  to  make  the  proposed  project  an  attractive  financial  investment. 

The  committee  recommends  that  a  further  detailed  study  of  devel- 
opment projects,  especially  highways,  public  utilities,  and  similar 
enterprises,  be  undertaken  by  the  Government,  and  that  an  effort  to 
the  extent  that  the  Republic's  resources  warrant  be  made  to  carry  out 
these  projects  as  a  unified  plan. 
140 


REPORT  OF  THE   CONFERENCE   COMMITTEE NICARAGUA.       141 

III.    AGRICULTURAL    BANK. 

In  view  of  the  fact  that  the  interest  rate  on  farm  loans  ranges 
from  12  per  cent  to  as  high  as  36  per  cent  maximum  per  annum, 
the  necessity  of  an  agricultural  bank  to  finance  the  needs  of  the 
small  farmer  is  apparent.  In  view  of  the  further  fact  that  the 
Government  of  Nicaragua  is  willing  to  cooperate  in  this  matter,  we 
recommend  that  measures  be  taken  to  establish  an  agricultural  bank, 
supported  by  American  capital,  to  furnish  farm  loans  at  a  reason- 
able rate  of  interest  and  with  a  long  amortization  period. 

IV.    NATIONAL  CREDIT  AND  THE  FACTORS  AFFECTING  IT. 

Since  the  United  States  Government  and  financiers  have  been  co- 
operating with  the  Nicaraguan  Government  in  questions  of  finance 
and  currency  there  has  been  established  a  sound  currency  system  on 
a  gold-exchange  basis ;  the  public  debt  has  been  reorganized,  consoli- 
dated, and  materially  reduced;  a  national  bank  has  been  estab- 
lished; a  large  volume  of  paper  currency,  formerly  irredeemable, 
has  been  converted  into  a  currency  on  a  par  with  gold;  the  customs 
tariff  has  been  thoroughly  revised,  the  service  has  been  completely 
reorganized  and  has  been  so  efficiently  administered  that  the  cost  of 
collection  has  been  greatly  reduced,  while  the  revenues  have  been 
considerably  increased;  the  railroad,  which  had  been  inefficiently 
managed  and  had  not  been  able  to  earn  dividends,  has  been  greatly 
improved  both  in  condition  of  road  and  equipment  and  in  the  char- 
acter of  operation,  and  is  now  paying  reasonable  dividends. 

The  use  of  $1,400,000  of  the  canal  treaty  funds  for  the  refunding  of 
the  internal  debt  substantially  increased  the  prosperity  of  the  coun- 
try, with  a  consequent  increase  of  Government  revenues. 

All  of  these  improved  financial  measures  which  have  been  carried 
into  effect  have  raised  to  a  very  high  degree  the  national  credit  of 
Nicaragua  and  its  citizens,  both  at  home  and  abroad. 

The  operation  of  the  financial  plan  through  a  budget  adapted 
to  the  real  needs  of  the  country  has  enabled  the  Government  not 
only  to  pay  a  portion  of  its  foreign  debt  before  maturity  but  has 
left  a  substantial  surplus  available  for  internal  improvements  and 
the  service  of  the  internal  debt. 

The  minister  of  finance  of  Nicaragua  in  his  preliminary  statement 
affirms  that  this  beneficial  association  with  the  United  States  has 
promoted  not  only  the  economic  welfare  but  likewise  the  financial 
and  political  independence  of  his  country. 

V.   CHAMBERS  OF  COMMERCE. 

The  group  committee  on  Nicaragua  favors  the  establishment, 
wherever  practicable,  of  chambers  of  commerce,  whose  duty  it  shall 
be  to  further  the  business  welfare  of  the  countrv  concerned,  pri- 


142  SECOND  PAN   AMERICAN   FINANCIAL   CONFERENCE. 

marily  through  increasing  the  cooperation  between  themselves  and 
the  chambers  of  commerce  of  other  North  and  South  American 
countries. 

VI.  ARBITRATION. 

The  committee  believe  that  commerce  between  the  different  coun- 
tries would  be  promoted  by  the  establishment  of  proper  measures  to 
secure  the  settlement  of  commercial  and  financial  disputes  through 
a  high  court  of  equity  or  proper  board  of  arbitration. 

VII.  REGULATIONS  REGARDING  CONSULAR  INVOICES  AND  BILLS  OF  LADING, 

Nicaragua  was  one  of  the  first  countries  to  follow  the  recommenda- 
tions of  the  First  Pan  American  Financial  Conference  in  instituting 
a  standard  form  of  consular  invoice  and  similar  regulations  of  bills 
of  lading  on  the  lines  ox  the  United  States  on  that  subject;  and  these 
measures  have  greatly  facilitated  the  trade  relations  between  Nica- 
ragua and  the  United  States.  As  a  consequence  of  these  experiences 
it  is  earnestly  recommended  that  the  Committee  on  Resolutions  set  in 
motion  the  proper  machinery  to  study  the  best  methods  of  securing 
promptly  by  other  Pan  American  countries  the  simplification,  unifi- 
cation, and  adoption  of  a  standard  form  of  consular  invoices  and 
bills  of  lading. 

VIII.   MISCELLANEOUS. 

Resolved,  That  due  consideration  for  our  mutual  interests  with 
friendly  nations — the  accurate  exchange  of  official  communica- 
tions and  the  maintenance  of  successful  financial  intercourse  be- 
tween the  Pan  American  Republics — demands  that  as  far  as  may 
be  practicable  all  ambassadors,  ministers,  and  consuls  hereafter 
sent  from  one  of  such  Republics  to  another,  shall  be  able  to  speak 
and  write  without  the  aid  of  an  interpreter  the  language  of 
the  country  to  which  they  are  sent,  for  in  this  way  many  un- 
necessary mistakes,  vexatious  delays,  and  costly  misunderstand- 
ings may  be  avoided. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  NICARAGUA, 

OCTAVIANO  CESAR,  Chairman. 

W.  L.  SAUNDERS,  Vice  Chairman. 


APPENDIX. 


The  difficulty  of  securing  foodstuffs  obliged  Nicaragua  to  grow 
more  cereals.  The  growing  of  wheat  was  stimulated  and  windmills 
will  be  imported.  Recently  there  has  arisen  the  manufacture  of  tex- 
tiles, the  tanning  of  hides  for  footwear  and  saddlery,  and  a  furniture 


REPORT   OF  THE   CONFERENCE   COMMITTEE NICARAGUA.       143 

factory  for  ordinary  and  high-grade  pieces  which  were  formerly 
imported. 

The  war  through  lack  of  shipment  and  governmental  embargoes 
almost  paralyzed  business.  Shipping  was  reduced  50  per  cent  during 
war  time,  and  ocean  freight  and  passenger  rates  were  enormously 
high.  Nicaragua  needs  reduction  in  ocean  freights  and  particularly 
on  parcel  post  packages.  It  is  hoped  and  believed  that  marine  in- 
surance will  be  reduced  below  war-time  rates. 

Private  finance  needs  lower  interest  rates  and  longer  maturities. 
National  capital  can  contribute  to  the  extent  of  only  20  per  cent  for 
this  purpose.  The  needs  along  new  business  are  those  of  railroads, 
coast-wise  shipping,  turtle  and  pearl  fishing,  and  the  exploitation  of 
manganese,  coal,  and  other  minerals. 

The  Republic  plans  the  substitution  of  another  form  of  revenue 
for  the  present  government  income  from  the  monopoly  in  the  sale  of 
all  alcoholic  beverages. 

There  are  excellent  lighthouses  at  the  four  principal  ports  of 
entry — two  on  the  Atlantic  coast  and  two  on  the  Pacific  coast.  At 
Bluefields  and  Corinto  ships  discharge  alongside  of  wharves. 

The  Republic  of  Nicaragua  has  signed  the  convention  concerning 
commercial  travelers  with  the  United  States. 

On  December  1, 1919,  a  postal  money  order  convention  between  the 
United  States  and  Nicaragua  went  into  effect. 

With  reference  to  the  international  gold-clearance  fund,  the  mone- 
tary system  and  the  financial  situation  of  Nicaragua  are  such  that 
there  is  no  immediate  need  for  such  a  fund. 

Radio  installation  for  governmental  purposes  is  also  contemplated, 
and  a  school  for  wireless  operators  is  now  in  existence. 

The  Hague  convention  on  bills  of  exchange  and  checks  has  been 
adopted. 

It  has  been  recommended  to  the  Government  of  Nicaragua  that 
there  be  incorporated  in  the  commercial  code  provisions  in  reference 
to  merchandise  shipped  on  consignment. 

Nicaragua  has  already  ratified  the  convention  for  the  registration 
of  trade-marks  in  Habana  and  Rio  de  Janeiro. 

FINANCIAL  CONDITION. 

The  financial,  economic,  and  internal  conditions  of  Nicaragua  are 
in  an  excellent  situation. 

The  budget  of  the  Republic  is  $95,000  per  month,  and  in  case  of 
urgent  need  this  can  be  increased  by  $26,666.66,  or  an  annual  admin- 
istrative budget,  excluding  debt  service,  of  $1,460,000.  Under  pres- 
ent contracts  the  Republic  devotes  50  per  cent  of  its  surplus  revenues 
for  redemption  of  foreign  debt  (partially  suspended  during  the  war), 


144  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

and  the  balance  is  used  for  public  improvements  and  the  service  of 
the  internal  debt.  For  the  calendar  year  1918  these  surplus  revenues 
amounted  to  $544,000.  For  the  six  months  ended  June  30,  1919,  they 
aggregated  $606,000,  and  from  cable  advices  recently  received  they 
have  jumped  to  $645,000  for  the  last  half  of  the  .year  1919. 

Internal  and  customs  revenues  have  shown  large  increases  for  1919 
as  compared  with  1918,  and  this  is  not  only  the  result  of  increased 
business,  but  also  more  efficient  financial  administration.  In  the  past 
two  years  Nicaragua  has  paid  $5,000,000  toward  redemption  of  and 
interest  on  its  foreign  and  internal  debt. 

Under  the  law  providing  for  the  issue  of  internal  bonds  (December, 
1917)  it  is  provided  that  the  high  commission1  shall  act  as  trustee 
and  fiscal  agent  for  this  bond  issue.  While  the  internal-debt  service 
is  not  entirely  covered  by  specially  hypothecated  revenues  at  present, 
the  prompt  payment  of  interest  and  regular  as  well  as  special  amor- 
tization have  caused  the  price  of  these  bonds  in  a  purely  local  market 
to  advance  from  30  to  62  within  the  past  18  months. 

Through  the  work  of  the  commission  on  public  credit  (from  March, 
1917,  to  June,  1919)  the  internal  debt  had  been  successfully  revised 
and  consolidated,  and  the  percentage  of  creditors,  both  foreign  and 
national,  who  did  not  accept  its  awards  is  so  small  as  to  be  almost 
negligible. 

The  high  commission  also  collaborated  with  the  other  ministries 
of  the  Government,  and  the  following  projects  have  been  completed 
or  are  under  way :  classified  budget ;  accounting,  reporting,  and  fiscal 
system ;  municipal  finance. 

With  Nicaragua  occupying  a  strategical  position  in  Central  Amer- 
ica and  its  raw  materials  and  wonderful  natural  resources,  coupled 
with  the  governmental  aid  and  encouragement  given  to  all  legitimate 
business  enterprises,  the  American  investor  and  business  man  can 
advantageously  put  his  money  into  Nicaragua. 

There  is  not  only  the  possibility  but  also  the  probability  that  in 
the  not  remote  future  the  Nicaraguan  canal  will  be  built.  Under  the 
Chamorro-Bryan  treaty  of  1916  the  United  States  Government  has 
an  option  in  perpetuity  for  its  construction. 

1  The  "  Alta  Comlsi6n,"  to  which  reference  is  here  made,  is  distinct  from   the  Nic 
raguan  section  of  the  Inter-American  High  Commission. 


PANAMA. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  or  THE  TREASURY  OF  THE   UNITED 

STATES. 
SIR  :  Your  committee  has  the  honor  to  submit  the  following  report : 

TRANSPORTATION. 

One  of  Panama's  greatest  problems  is  that  of  transportation, 
especially  as  it  relates  to  domestic  commerce.  With  regard  to  for- 
eign commerce,  Panama's  greatest  asset  is  its  strategic  position  on  the 
canal,  the  connecting  link  for  shipping  between  the  two  oceans. 
Panama  has  a  vital  internal  transportation  problem  to  solve,  but  ex- 
ternal problems  are  few,  since  the  shipping  of  the  world  focuses 
naturally  on  the  two  mouths  of  the  canal,  near  which  are  located  the 
cities  of  Colon  and  Panama.  Panama's  problem  in  respect  to  trans- 
portation is  to  connect  the  Republic  by  a  system  of  highways  and 
waterways  with  the  main  transportation  arteries,  namely,  the  Panama 
Railroad  and  the  Panama  Canal. 

It  would  be  beneficial  if  in  the  Republic  of  Panama  there  were  con- 
structed a  system  of  branch  highways  which  would  lead  by  land  and 
water  from  the  interior  and  distant  Provinces  to  the  main  highway 
with  terminals  at  Colon  and  Panama  City.  While  Panama  greatly 
desires  the  completion  of  the  Pan  American  Railway,  yet  with  mod- 
ern highways  and  motor  trucks,  the  economic  distribution  of  her 
products  could  be  to  a  large  extent  effectively  handled. 

The  coastwise  commerce  of  the  Republic  would  be  greatly  stimu- 
lated if  there  existed  further  vessels  specially  adapted  for  use  on  the 
many  rivers  and  harbors  and  on  the  oceans  in  marketing  the  products 
of  the  country,  to  the  end  that  the  produce  of  Panama  may  be  con- 
veyed to  the  shipping  points,  thereby  facilitating  her  commerce  with 
the  United  States  in  particular. 

The  United  States  has  already  surveyed  a  system  of  highways 
crossing  the  Isthmus  and  also  at  right  angles  to  the  canal  and  encir- 
cling the  elevations.  For  the  economic  development  of  that  part  of 
the  Republic  adjacent  to  the  Canal  Zone,  Panama's  road-building 
program  could  be  carried  out,  in  cooperation  with  the  United  States, 
by  extension  of  this  system  of  highways,  to  the  benefit  of  both  coun- 
tries. 

14970—21 10  145 


146  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

The  Republic  is  at  present  largely  dependent  upon  the  Panama 
Railroad,  owned  and  operated  by  the  United  States  Government,  for 
trans-Isthmus  freight  and  passenger  transportation.  Closer  relations 
should  be  established  between  the  Republic  of  Panama  and  the  United 
States  to  the  end  that  the  latter  not  only  extend  every  consideration 
possible  consistent  with  economic  handling  of  the  property  but  also 
adopt  as  its  policy  a  plan  of  cooperation  with  the  Republic.  It  is 
recommended  that  a  cooperative  agreement  might  appropriately  be 
reached,  giving  more  consideration  to  the  economic  needs  of  Panama 
in  the  development  of  its  foreign  and  domestic  commerce. 

In  view  of  the  above  report,  Mr.  Clarence  J.  Owens  moved,  Mr. 
George  Mixter  seconded,  and  the  committee  unanimously  adopted 
the  following  resolutions : 

i. 

Resolved,  That  a  commission  should  be  appointed  consisting 
of  representatives  of  the  Republic  of  Panama  and  of  the  United 
States  to  consider  the  operation  of  the  Panama  Railroad  and  its 
steamships  with  a  view  to  granting  to  the  merchants  in  Panama 
further  consideration  in  regard  to  freight  rates  and  facilities  for 
the  movement  of  the  commerce  of  the  country. 

Resolved,  That  the  cooperation  of  the  United  States  with  the 
Republic  of  Panama  in  the  construction  of  a  system  of  highways 
in  the  Republic  would  be  most  helpful  to  the  economic  develop- 
ment of  Panama  and  to  the  successful  operation,  maintenance, 
and  protection  of  the  canal. 

Resolved,  That  regulations  regarding  storage  for  the  com- 
merce of  the  Republic  of  Panama  should  be  established  by  the 
Panama  Railroad  and  Canal  Zone  similar  to  those  prevailing  in 
the  case  of  goods  coming  from  foreign  countries. 

Resolved,  That  the  United  States  and  the  Republic  of  Panama 
should  at  all  times  cooperate  with  the  end  in  view  that  the 
Panama  section  of  the  contemplated  Pan  American  Railroad  be 
constructed  at  the  earliest  date  possible. 

i 
ii. 

Whereas  the  United  States  is  desirous  of  carrying  on  exten- 
sive commercial  intercourse  with  Pan  America :  Now,  therefore, 
be  it 

Resolved,  That  all  articles  should  be  weighed,  marked,  and 
shipping  documents  prepared  in  the  American  system  and  the 
metric  system  at  the  same  time. 


REPORT   OF  THE    CONFERENCE    COMMITTEE — PANAMA.         147 

III. 

Whereas  the  monetary  system  of  North  and  South  America 
is  a  decimal  system,  but  varies  in  standard  of  value  in' different 
countries :  Now,  therefore,  be  it 

Resolved,  That  careful  consideration  should  be  given  to  the 
question  of  harmonizing  and  standardizing  coins  in  the  countries 
of  the  American  Continents  so  that  they  may  bear  direct  rela- 
tionship to  the  dollar  and  conform  as  closely  as  possible  to  the 
coinage  of  the  United  States  and  Panama  in  respect  to  standard 
of  value. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  PANAMA, 
J.  A.  ARANGO,  Chairman. 
JAMES  BROWN,  Vice  Chairman. 


PARAGUAY. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the  SECRETARY  or  THE  TREASURY  OF  THE  UNITED 
STATES. 

SIR:  Your  committee  has  the  honor  to  submit  the  following 
report : 

Paraguay  has  increased  her  trade  from  $14,000,000  in  1913  to 
$25,000,000  in  1919.  This  is  but  a  beginning  of  the  progress  she  can 
confidently  be  expected  to  make  when  her  great  and  varied  resources 
are  developed.  In  order  to  develop  them  Paraguay  requires : 

1.  Permanent  investment  of  capital. 

2.  Improved  transportation. 

3.  Improved  monetary  system. 

4.  Increased  immigration. 

PERMANENT  INVESTMENT  OF  CAPITAL. 

The  Paraguay  committee  at  the  Second  Pan  American  Financial 
Conference,  held  in  Washington  in  January,  1920,  believes  that  it 
should  put  in  the  forefront  of  this  brief  report  the  record  of  perform- 
ance which  Paraguay  has  made  in  carrying  out  the  program  of  the 
First  Pan  American  Financial  Conference,  which  met  in  Washington 
in  1915.  This  record  is  a  hopeful  guaranty  of  Paraguay's  determi- 
nation to  insure  fair  treatment  to  citizens  of  the  United  States  seek- 
ing trade  or  investment  within  her  borders.  The  International  High 
Commission  has  reported  to  the  present  conference  that  Paraguay 
has  ratified  the  patent  and  trade-mark  convention.  Under  the  terms 
of  this  convention  Paraquay  belongs  to  the  southern  group  of  Latin- 
American  countries,  which  is  to  have  an  International  Bureau  for 
the  Registration  of  Trade  Marks  at  Rio  de  Janeiro  similar  to  the  one 
in  operation  at  Habana.  But  Paraguay,  awaiting  the  ratification  of 
the  convention  by  certain  countries  belonging  to  the  southern  group, 
has  independently  taken  action  protecting  trade  marks.  And  Para- 
guay -favors  the  use  of  the  Habana  bureau  until  the  Rio  de  Janeiro 
bureau  is  opened. 

148 


REPORT   OF   THE   CONFERENCE   COMMITTEE PARAGUAY.        149 

Another  measure  which  has  been  pressed  by  the  International 
High  Commission  is  the  convention  concerning  commercial  travelers, 
proposed  by  the  central  executive  council  of  the  commission  and 
based  on  recommendations  of  the  commission  made  at  Buenos  Aires, 
April,  1916.  This  convention  was  signed  by  Paraguay  and  the 
United  States  on  October  20, 1919. 

Another  measure  of  great  significance  for  the  future  is  the  treaty 
for  the  establishment  of  an  international  gold  clearance  fund.  This 
convention  was  proposed  by  the  central  executive  council  of  the  In- 
ternational High  Commission  based  on  recommendations  of  the  com- 
mission at  Buenos  Aires,  April,  1916.  Paraguay  was  the  first  country 
to  sign  this  convention. 

With  respect  to  the  uniform  measures  as  to  bills  of  exchange,  which 
measures  are  the  modified  Hague  rules  of  1912,  as  modified  according 
to  the  recommendations  of  the  International  High  Commission,  made 
at  Buenos  Aires,  1916,  Paraguay  has  introduced  bills  in  its  Congress 
embodying  provisions  for  the  revision  of  the  commercial  code  in 
accordance  with  the  recommendations. 

Arbitration  of  commercial  disputes  proposed  by  the  United  States 
Chamber  of  Commerce  on  the  basis  of  recommendations  of  the  First 
Pan  American  Financial  Conference  has  been  accepted  by  Paraguay, 
and  an  agreement  between  the  Chambers  of  Commerce  of  the  United 
States  and  Asuncion  was  completed  in  Washington  while  this  Pan 
American  Financial  Conference  was  in  session. 

The  uniform  statistical  classification  of  merchandise  based  upon 
the  Brussels  convention  of  November,  1913,  and  the  uniform  classifi- 
cation recommended  by  the  International  High  Commission  at 
Buenos  Aires,  1916,  has  been  adopted  by  Paraguay. 

As  regards  customs  regulations,  the  provisions  relating  to  sanitary 
visits  outside  regular  hours  and  advance  preparation  of  cargos  have 
been  adopted  by  Paraguay,  while  the  recommendations  relating  to 
simultaneous  loading  and  unloading  of  cargoes  are  now  under  con- 
sideration. 

This  record  of  prompt  performance  by  Paraguay  of  practically 
all  of  the  program  proposed  at  the  First  Pan  American  Financial 
Conference,  together  with  the  facts  in  regard  to  the  conditions  and 
resources  of  Paraguay,  which  have  been  presented  in  detail  by  the 
delegates  from  Paraguay,  have  resulted  in  the  opinion  on  the  part  of 
the  group  committee  that  private  capital  of  the  United  States  can 
with  safety  consider  investment  in  the  securities  of  the  Paraguayan 
Government  and  in  Paraguayan  private  enterprises. 

As  to  the  proper  returns  to  be  expected  from  such  investments,  no 
exact  rate  can  reasonably  be  fixed,  but  will  have  to  be  determined  in 
each  specific  case,  which  primarily  must  be  governed  by  the  law  of 


150  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

supply  and  demand.  It  is  fair  to  presume,  however,  that  the  net  re- 
turns on  such  investments  should  be  somewhat  larger  than  the  lender 
of  capital  would  normally  receive  from  similar  investments  within 
his  own  country.  Furthermore,  the  returns  from  capital  invested  in 
Paraguay  will  necessarily  have  to  be  as  large  as  those  obtainable 
from  similar  investments  in  neighboring  countries  to  become  at- 
tractive. 

As  an  important  investment  fact  it  is  reported  that  three  large 
packing  plants,  affiliated  with  three  of  the  largest  Chicago  packing 
companies,  have  been  established  in  Paraguay  since  the  First  Pan 
American  Conference  met  in  1915. 

In  regard  to  commercial  credits,  the  committee  learned  with  satis- 
faction that  Paraguayan  business  houses  are  growing  accustomed  to 
the  practice,  common  in  the  United  States,  of  supplying  financial 
statements  as  the  basis  for  credit. 

The  committee  believes  that  it  would  be  most  advantageous  for  the 
merchants  of  Paraguay  to  advise  their  bankers  regarding  the  person- 
nel of  their  organizations,  number  of  years  established,  nature  of 
business,  capital  employed,  turnover  per  year,  value  of  stocks  car- 
ried, and  their  latest  balance  sheet.  With  this  information  the  busi- 
ness houses  would  become  internationally  known  and  credits  desired 
would  undoubtedly  be  secured. 

IMPROVED    TRANSPORTATION. 

Paraguay,  being  an  inland  country,  needs  better  transportation. 
The  present  transportation  facilities  between  the  United  States  and 
the  River  Plate  are  but  little  better  than  during  the  war,  and  the 
lack  of  sufficient  tonnage  and  the  infrequency  of  sailings  constitute 
a  serious  handicap  not  only  to  trade  between  Paraguay  and  the 
United  States  but  to  all  other  economic  relations  as  well.  At  times 
more  than  two  months  are  required  to  reach  the  River  Plate  from 
New  York,  and  travelers  between  the  United  States  and  Paraguay 
often  find  it  necessary  to  go  by  way  of  the  west  coast  of  South 
America.  The  committee  strongly  recommends  that  steps  be  taken 
at  once  to  establish  a  service  providing  at  least  fortnightly  sailings 
from  both  New  York  and  Buenos  Aires,  and  that  the  sailing  time  be 
reduced  to  a  time  no  longer  than  that  required  for  a  voyage  between 
Europe  ,and  the  River  Plate. 

The  chief  outlet  for  Paraguay's  foreign  trade  is  the  river  route 
by  way  of  the  Paraguay  and  Parana  Rivers,  and  except  in  times  of 
low  water  this  river  route  is  navigable  for  boats  of  12- foot  draft  as 
far  north  as  Corrientes  and  for  boats  of  7- foot  draft  from  Corrientes 
to  Asuncion.  There  are  three  or  four  bad  spots  in  the  river  between 


REPORT   OF   THE    CONFERENCE    COMMITTEE PARAGUAY.        151 

Corrientes  and  Asuncion  which  could  probably  be  kept  open  easily 
and  cheaply  by  dredging,  thus  avoiding  transshipment  of  cargo, 
which  now  increases  the  expense  of  shipping  by  20  per  cent.  The 
river  traffic  is  now  almost  entirely  in  the  control  of  a  single  line, 
which  in  recent  years  has  absorbed  three  of  its  largest  competitors. 
The  high  rates  charged  for  river  traffic  are  said  to  discourage  Para- 
guay's trade,  and  the  establishment  of  a  new  line  of  river  steamers 
has  been  suggested  as  a  means  of  remedying  the  situation.  With 
Paraguay's  steadily  increasing  commerce,  it  is  thought  such  a  line 
would  be  profitable.  The  International  Products  Co.  has  announced 
that  it  will  put  two  new  boats  of  1,000  tons  each  into  this  river  serv- 
ice about  August,  1920,  which  will  be  available  for  carrying  two  or 
three  hundred  tons  of  outside  freight  downstream  and  full  cargoes 
upstream.  Besides  the  river  route,  Paraguay  has  an  outlet  to  the 
River  Plate  over  a  railway  line  to  Buenos  Aires  from  Asuncion. 
This  line,  however,  is  in  the  control  of  four  different  companies,  and 
its  terminus  in  Buenos  Aires  is  several  miles  from  the  docks.  Except 
for  high-priced  freight,  therefore,  the  line  does  not  afford  effective 
•competition  with  the  river  route. 

The  existing  port  facilities  at  Asuncion,  the  chief  city  of  Paraguay, 
are  inadequate,  and  an  improvement  in  them  would  bring  a  distinct 
economic  benefit  to  Paraguay's  freight  trade. 

The  telegraph  service  between  Buenos  Aires  and  Asuncion  is  poor ; 
the  part  of  the  line  going  through  Argentine  territory  is  owned  and 
operated  by  the  Argentine  Government  and  that  part  going  through 
Paraguayan  territory  is  owned  and  operated  by  Paraguay.  A  joint 
inquiry  by  representatives  of  both  Governments  would  probably 
result  in  improvements,  which  would  be  very  beneficial  to  commerce 
between  the  United  States  and  Paraguay. 

For  internal  transportation  Paraguay  needs  good  highways  for 
motor  trucks  and  teams  as  feeders  to  the  present  railway  and  the 
river  systems,  and,  as  the  country  develops,  will  need  more  and  more 
short  branch  railways  for  the  same  purpose.  If  such  improved 
means  of  transportation  and  communication  are  made  available,  the 
economic  developments  of  Paraguay  will  be  greatly  stimulated,  as 
these  new  roads  and  railways  will  open  much  productive  land  to 
colonization. 

A  railway  line  which  is  projected  to  connect  Paraguay  with  the 
Brazilian  seaport  of  San  Francisco  has  been  constructed  part  of  the 
way  to  the  Brazilian  border,  but  its  continuation  must  await  con- 
struction of  the  Brazilian  section.  This  extension  would  benefit 
Paraguay  very  greatly,  as  it  would  give  Paraguay  a  second  outlet 
to  the  Atlantic  Ocean,  and  would  decrease  the  time  6f  the  journey  to 
the  United  States  by  about  five  days. 


152  SECOND  PAN   AMERICAN   FINANCIAL  CONFERENCE. 

IMPROVED    MONETARY     SYSTEM. 

Paraguay  is  making  arrangements  to  procure  the  services  of  a 
financial  expert,  probably  from  the  United  States,  to  reorganize  its 
fiscal-revenue  system. 

At  present  import  and  export  business  wholly,  and  some  other 
business  partially,  are  based  on  Argentine  gold  dollars.  The  prin- 
cipal medium  of  circulation  is  the  Paraguayan  paper  peso,  of  which 
125,000,000  have  been  issued  by  the  Government  during  the  course 
of  many  years.  Against  this  issue  the  "Oficina  de  Cambios" 
(Exchange  Office)  holds  about  $1,500,000  gold,  which,  at  present 
rate  of  exchange,  represents  about  25  per  cent  of  the  total  issue. 
Measures  have  been  taken  to  increase  the  reserve  or  stock  of  gold  to 
50  per  cent  of  the  value  of  the  currency  issued,  when  the  conversion 
rate  will  be  fixed.  The  continuous  fluctuations  in  the  local  value 
of  the  paper  peso  is  a  serious  drawback  to  all  business;  this  will 
disappear  when  the  conversion  rate  is  fixed. 

INCREASED    IMMIGRATION. 

Paraguay's  progressive  policy  in  encouraging  immigration  was 
highly  commended  by  the  conference  committee.  Immigration 
has  been  steadily  increasing,  and  is  expected  to  increase  still  more 
as  the  country's  transportation  and  agricultural  interests  are  devel- 
oped. Laborers  in  various  parts  of  Europe,  particularly  in  central 
Europe,  have  shown  great  interest  in  the  possibilities  of  obtaining 
land  in  Paraguay,  as  evidenced  by  the  numerous  applications  re- 
ceived by  the  Government  for  information  on  that  subject.  Para- 
guay now  pays  the  fare  of  immigrants  from  Buenos  Aires  to  Asun- 
cion and  gives  them  a  month's  subsistence  free  of  charge.  It  also 
affords  them  opportunity  to  obtain  good  land  at  very  low  rates. 
Such  policy,  if  continued,  should  result,  in  the  committee's  opinion, 
in  supplying  Paraguay  with  the  labor  which  it  now  needs  to  bring 
out  the  riches  of  its  fields,  forests,  and  mineral  resources. 


PARAGUAY'S  RESOURCES. 


Paraguay  has  many  promising  lines  of  economic  development. 
The  most  profitable  of  these  at  present  is  cattle  raising,  which  has 
been  greatly  stimulated  by  the  building  of  packing  companies,  al- 
ready referred  to,  which  have  come  into  the  country  in  recent  years 
and  erected  establishments  which  employ  3,000  to  4,000  workers 
each.  Their  policy  of  affording  good  food  and  housing  facilities 
to  their  laborers 'has  had  an  excellent  effect  in  the  country  in  popu- 
larizing United  States  enterprise.  There  are  now  some  5,500,000 


REPORT   OF   THE   CONFERENCE   COMMITTEE PARAGUAY.        153 

head  of  cattle  in  Paraguay,  and  there  is  room  for  over  five  times 
that  number.  The  natural  increase  of  cattle  is  20  to  30  per  cent 
annually,  and  cattle  diseases  are  uncommon.  Grazing  land  is  plen- 
tiful and  is  valued  at  $6,000  to  $12,000  per  square  league,  or  $1.30 
to  $2.60  gold  per  acre. 

Paraguay's  world-famous  quebracho  industry  is  capable  of  fur- 
ther development,  and  constitutes  one  of  the  country's  chief  sources 
of  wealth  in  the  future  as  it  has  in  the  past.  The  tanning  extract 
is  its  present  important  product,  but  the  hard,  durable  wood  is  also 
most  valuable  in  railroad  and  other  construction  work.  Paraguay 
also  has  many  most  valuable  woods  for  general  building  purposes. 

Paraguay  cotton  ranks  in  quality  with  the  best  in  the  world,  and 
the  cotton-growing  industry  is  one  of  the  most  promising  in  the 
country.  Through  the  Banco  Agricola  the  Government  is  giving 
encouragement  to  the  industry,  at  present  by  maintaining  fixed 
prices  for  cotton.  Cotton  is  now  raised  in  small  tracts,  being  essen- 
tially a  "  home  industry."  It  is  expected  that  in  a  few  years  Para- 
guay will  begin  to  export  cotton.  A  plant  producing  a  fiber  very 
similar  to  jute  has  been  introduced  from  Africa  and  has  been  found 
to  grow  well  in  Paraguay,  giving  promise  of  a  future  source  of 
material  for  making  bags  for  containing  products  of  the  country. 

The  Government  of  Paraguay  is  especially  interested  in  giving 
the  fullest  information  to  inquirers  in  the  United  States  regarding 
the  resources  of  the  country,  and  will  send  full  collections  of  sam- 
ples of  Paraguay  products  for  permanent  exhibition  to  any  respon- 
sible association  desiring  them.  One  such  collection  is  to  be  placed 
in  the  Philadelphia  Commercial  Museum.  Through  such  exhibits 
the  study  of  Paraguay's  resources  by  United  States  investors  and 
those  interested  in  the  commerce  of  the  country  will  be  greatly 
facilitated. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  PARAGUAY, 

EUSEBIO  AYALA,  Chairman. 

LEWIS  E.  PIERSON,  Vice  Chairman. 


PERU. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the   SECRETARY  OF  THE  TREASURY  or  THE  UNITED 
STATES. 

SIR:  As  the  result  of  the  First  Pan  American  Financial  Confer- 
ence in  1915,  the  cordial  relations  which  have  for  so  many  years  ex- 
isted between  the  Republic  of  Peru  and  the  United  States  have  been 
further  strengthened.  It  is  highly  important  to  both  countries  that 
these  relations  should  be  constantly  and  progressively  developed. 

The  commerce  between  the  two  countries  has  increased,  and  with 
a  proper  extension  of  shipping  facilities,  it  is  quite  certain  that 
the  trade  of  Peru  with  the  United  States,  which  is  already  its  largest 
customer,  will  steadily  increase. 

The  recommendation  of  the  group  committee  report  of  1915,  which 
is  hereby  reaffirmed,  with  respect  to  the  establishment  of  branches 
of  American  banking  institutions  in  Peru,  has  been  acted  upon  by 
several  of  the  largest  banks  of  the  United  States.  Two  American 
branch  banks  have  already  been  established,  and  serve  as  important 
instrumentalities  for  developing  closer  commercial  and  financial 
relations  between  the  two  countries. 

The  Republic  of  Peru  embraces  a  territory  of  2,000,000  square 
kilometers  and  has  a  population  of  4,500,000.  The  exceptional  cli- 
matic conditions  of  the  Peruvian  coast  make  it  an  ideal  country 
for  tropical  and  semi  tropical  agricultural  growth,  while  there  is 
little  doubt  that  its  resources  of  raw  materials  are  very  great,  in- 
cluding sugar,  cotton,  wool,  hides  and  skins,  rubber,  copper,  vana- 
dium, tungsten,  iron  ore,  petroleum,  coal,  gold,  and  silver. 

The  development  of  these  natural  resources  has  been  very  limited, 
due  to  the  lack  of  adequate  railroad  facilities,  and  it  is  quite  ap- 
parent that,  given  the  necessary  capital  for  such  development,  the 
Republic  of  Peru  could  greatly  increase  its  contribution  to  the  world's 
need  of  these  raw  materials,  at  the  same  time  vastly  increasing  its 
production  of  food  supplies  so  generally  required  throughout  the 
world. 

The  Government  of  Peru  has  evolved  a  comprehensive  financial 
program,  based  upon  sound  economic  principles,  which  aims  at  the 
development  of  these  extensive  natural  resources. 
154 


REPORT    OF   THE    CONFERENCE    COMMITTEE PERU.  155 

The  Peruvian  delegation  has  presented  the  before-mentioned  com- 
prehensive plan  of  financial  reorganization  and  development,  nota- 
bly the  establishment  of  a  national  bank,  under  proper  protection 
of  the  Government  and  supervision  of  its  officials.  This  bank  is 
not  to  be  a  bank  of  deposit,  but  a  consolidation  of  the  various  col- 
lecting companies  of  that  country  and  a  bank  of  issue,  such  issues 
to  be  secured  by  60  per  cent  in  gold  and  40  per  cent  negotiable  se- 
curities, such  subsecurities  being  representative  of  its  agricultural, 
industrial,  mineral,  and  railroad  investments,  the  bank  thus  main- 
taining at  all  times  the  necessary  fundamental  gold  reserve  and  at 
the  same  time  holding  a  volume  of  securities,  the  interest  or  divi- 
dends upon  which  would  constitute  an  additional  source  of  profit. 

The  financial  needs  have  been  summarized  by  the  Peruvian  dele- 
gation as  follows : 

Railroads $40,  000, 000 

Roads 6, 000,  000 

Sanitation 10,  000,  000 

irrigation  and  colonization ^ 55,  000,  000 

Docks  and  ports  improvements 6,  000, 000 

National  bank,  including  conversion  of  debts 29,  000,  000 

Iron   mines 1,  500,  000 

Coal  and  petroleum 2,000,000 

Electrolytic  copper  refining 1,  000,  000 

Manufacture  of  explosives  for  mining  purposes 1,  500,  000 

Total 152,  000,  000 

It  is  purposed  to  secure  the  amount  required  by  the  issue  of 
national  bank  debentures,  the  security  for  which  will  be  the  resources 
of  the  bank;  the  profits  accruing  from  their  various  collecting  con- 
tracts (which  are  said  to  be  large),  and  the  total  resources  and  assets 
of  the  various  projects  to  which  these  moneys  will  be  applied.  These 
debentures  will  bear  a  fixed  rate  of  interest,  and  will  also  participate 
in  the  profits  of  the  national  bank  and  its  various  subsidiary  com- 
panies, which  make  them  an  attractive  investment. 

To  insure  the  underwriting  and  sale  of  the  securities  of  the 
National  Bank  of  Peru,  the  Government  of  the  Eepublic  of  Peru 
should  guarantee  their  payment,  principal  and  interest,  providing 
for  the  payment  of  the  principal  by  adequate  annual  amortization, 
out  of  the  revenue  of  the  Government,  as  collected  by  the  bank. 

It  is  to  be  noted  that  the  plan  presented  contemplates  the  retiring 
of  the  entire  national  debt  of  the  Republic  of  Peru  and  the  refunding 
of  all  such  obligations  into  the  one  issue  by  the  national  bank.  The 
present  debt  of  the  Republic  of  Peru  is  about  $27,000,000  with  an 
annual  income  of  $25,000,000,  and  its  revenues  in  the  year  of  1918 
exceeded  its  expenditures  approximately  $3,000,000.  The  exports 
of  Peru  were  close  to  $100,000,000  in  1918  and  its  imports  about 
$50,000,000. 


156  SECOND  PAN  AMERICAN   FINANCIAL  CONFERENCE. 

The  plan  presented  by  the  delegates  from  Peru,  in  the  judgment 
of  the  Peruvian  group,  is  sound  in  principle  and  should  command 
the  support  of  American  investors.  The  realization  of  the  plan 
would  not  only  result  greatly  to  the  advantage  of  Peru  but  likewise 
confer  collateral  advantages  upon  the  United  States  by  increasing 
the  commerce  between  those  countries  while  adding  substantially  to 
the  world's  production  of  essential  commodities.  The  financial  con- 
ditions now  existing,  however,  are  not  such  as  to  make  it  practicable 
to  attempt  such  an  extensive  financial  operation  in  this  country.  The 
requirements  for  enormous  capital  expenditures  in  the  United  States 
incident  to  the  reconstruction  of  its  own  and  the  economic  and  in- 
dustrial life  of  its  associates  in  the  war  has  advanced  interest  rates 
to  the  point  where  it  would  make  it  quite  difficult  to  exploit  such  an 
enterprise  in  its  investment  markets. 

A  recent  act  of  the  Congress  of  the  United  States,  known  as  the 
Edge  bill,  authorizes  the  incorporation  of  companies  to  develop  and 
encourage  international  financing,  and  it  is  recommended  that  the 
plan  presented  by  the  Peruvian  delegates  be  referred  for  considera- 
tion and  development  to  such  companies  created  under  this  act  of 
Congress. 

The  committee  is  gratified  to  be  able  to  report  that  the  Republic 
of  Peru  has  already  advanced  far  along  the  line  of  development  of 
uniformity  of  legislation  in  relation  to  the  six  subheadings  undei 
Topic  VI  of  the  program  of  topics  agreed  upon  for  submission  to  the 
conference.  • 

In  particular  a  classification  of  imports  and  exports  has  been 
adopted  conforming  to  the  Brussels  convention.  In  as  far  as  these 
matters  are  dependent  upon  further  international  agreement  the  Re- 
public of  Peru  is  not  only  willing  but  anxious  to  cooperate. 

There  is  still  a  lack  of  means  of  wireless  communication  between  the 
several  countries  of  South  America  and  between  South  America  and 
the  United  States.  It  is  the  opinion  of  the  Peruvian  conference  com- 
mittee that  better  facilities  in  this  direction  should  be  developed,  and 
therefore  it  is  suggested  that  a  committee  be  appointed  from  the 
countries  interested  to  consider  further  and  report  upon  this  matter. 

The  Peruvian  conference  committee  desires  to  record  its  satisfac- 
tion in  having  been  afforded  this  opportunity  for  conference  and  dis- 
cussion, the  fruits  of  which  it  is  hoped  will  further  cement  the 
friendly  and  cordial  relations  which  have  for  so  many  years  existed 
between  the  peoples  and  Governments  of  Peru  and  the  United  States. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  PERU, 

F.  C.  FUCHS,  Chairman. 

JOHN  H.  FAHEY,  Vice  Chairman. 


EL  SALVADOR. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the  SECRETARY  OF  THE  TREASURY  OF  THE  UNITED 
STATES. 

SIR  :  The  conference  committee  to  consider  relations,  financial  and 
commercial,  between  the  Republic  of  Salvador  and  the  United  States 
begs  to  submit  the  following  report  of  its  deliberations. 

There  were  present :  The  official  delegation  from  Salvador,  His  ex- 
cellency, Dr.  Jose  Esperanza  Suay,  minister  of  finance  of  Salvador, 
and  Dr.  Reyes  Arrieta  Rossi;  as  special  guest  of  the  Secretary  of 
the  Treasury,  the  minister  of  Salvador,  Senor  Salvador  Sol ;  as  special 
representative  of  the  Secretary  of  the  Treasury,  Hon.  James  H. 
Moyle ;  and  the  following  United  States  members  of  the  group  com- 
mittee:  W.  S.  Rowe  (chairman),  O.  C.  Fuller,  Otto  N.  Frenzel,  jr., 
George  H.  Harries,  James  T.  Keena,  George  C.  Luebbers,  George  E. 
Macomber,  G.  A.  Northcott,  Harry  Harwood  Rousseau,  Dayton  Shel- 
ley, Jerome  Thralls,  Charles  W.  Warden,  Oscar  Wells,  and  Walter 
F.  McCaleb  (secretary). 

The  discussions  of  the  various  problems  resolved  themselves  into 
two  heads : 

1.  Transportation  and  communication. 

2.  Banking  facilities  and  trade  relations. 

After  giving  careful  thought  through  the  sessions  of  the  conference 
on  Monday,  Tuesday,  and  Wednesday  of  the  present  week,  we  submit 
the  following  conclusions. 


At  the  First  Pan  American  Financial  Conference,  held  in  May. 
1915,  it  was  reported  that  better  transportation  by  sea  was  greatly 
needed  by  Salvador,  so  that  mails,  passengers,  and  products  could 
more  readily  and  speedily  pass  between  Salvador  and  the  United 
States. 

This  condition  exists  at  the  present  day,  and  as  a  result  of  com- 
plications arising  out  of  the  war  to  even  a  greater  degree  than  ever 
before.  Prior  to  the  war  Salvador  was  served  not  only  by  the  Pacific 
Mail  Steamship  Co.  with  a  dozen  ships,  but  also  by  several  European 
steamship  lines,  including  the  German  Kosmos.  The  Salvador  Rail- 

157 


158  SECOND   PAN   AMERICAN   FINANCIAL   CONFERENCE. 

road  Co.,  an  English  association,  also  had  three  small  steamers  in 
coastwise  service.  At  the  present  time  Salvador  is  served  only  by 
the  Pacific  Mail  Steamship  Co.  with  four  steamers,  and  your  com- 
mittee feels  that  the  need  of  better  and  more  frequent  steamer  service 
is  urgent. 

Such  need  would  be  filled  by  the  allocation  of  additional  cargo  and 
passenger  vessels  that  will  give  more  frequent  and  better  service 
between  Salvadorean  ports  and  Atlantic  and  Pacific  ports  of  the 
United  States.  Your  committee  recommends  for  specific  considera- 
tion in  this  connection  the  inauguration  of  a  special  monthly  steam- 
ship service  from  some  Atlantic  port,  such  as  New  York,  Baltimore, 
or  New  Orleans,  running  direct  to  Salvadorean  ports,  passing  through 
the  Panama  Canal.  This  line  would  speedily  demonstrate  the  de- 
gree of  its  usefulness  and  make  further  planning  something  more 
than  conjectural. 

The  Salvadorean  Government  has  agreed  to  forward  all  efforts 
looking  to  improved  communication  with  the  United  States.  It 
freely  proffers  special  concessions  to  those  of  pur  steamers  which 
touch  regularly  at  its  ports  and  is  prepared  not  only  to  reduce  or 
eliminate  port  dues  but  has  announced  that  a  reasonable  subsidy 
would  be  practicable  where  the  arrangements  were  mutually 
satisfactory. 

Rail  transportation  in  Salvador  was  not  affected  to  any  appre- 
ciable extent  by  the  war.  New  construction  of  the  International 
Railroad  Co.  of  Salvador  has  been  and  is  still  being  greatly  delayed 
through  the  difficulty  in  obtaining  materials  for  the  construction  of 
the  branch  line  from  La  Union  to  the  capital.  Increased  steamship 
facilities  will  aid  in  removing  this  difficulty. 

Your  committee  considers  particularly  important  not  only  the 
foregoing  extension  but  also  the  branch  that  will  connect  the  city 
of  Santa  Ana  with  Zacapa  in  the  Republic  of  Guatemala,  which 
will  result  in  the  completion  of  a  through  rail  route  from  La  Union 
on  the  Pacific  to  Puerto  Barrios  on  the  Atlantic  and  will  give  Salva- 
dor a  direct  outlet  to  the  Atlantic  through  Guatemala.  This  will 
reduce  the  tune  of  journey  from  Salvador  to  New  Orleans  and  New 
York  to  five  and  eight  days,  respectively.  These  extensions  will 
serve  amply  when  the  necessary  150  miles,  more  or  less,  have  been 
built. 

We  renew  the  recommendations  made  at  the  conference  in  1915 
favoring  an  increase  of  first-class  highway  mileage,  for  without 
soundly  constructed  and  maintained  highways  the  distribution  prob- 
lem can  not  be  economically  solved. 

On  this  point  it  is  a  satisfaction  for  your  committee  to  state  that 
Salvador  has  constructed  in  the  last  three  years  a  macadam  highway 
from  the  port  of  La  Libertad  to  the  capital,  a  length  of  40  miles, 


REPORT  OF  THE  CONFERENCE  COMMITTEE — EL  SALVADOR.     159 

thus  affording  to  commerce  an  additional  easy  outlet  and  inlet  for  its 

exports  and  imports. 

Your  committee  on  the  subject  of  transportation  begs  to  suggest: 

That  steamship  lines  can  be  greatly  strengthened  and  devel- 
oped through  the  sympathetic  study  of  the  commercial  and 
credit  needs  of  the  American  States  in  general,  and  especially 
we  hold  this  to  be  true  in  the  case  of  Salvador.  In  a  word, 
steamship  lines  must  eventually  become  self-sustaining  if  they 
are  to  continue  to  operate,  and  this  will  depend  on  the  develop- 
ment of  permanent  and  mutually  satisfactory  commercial  bases 
as  between  our  country  and  the  other  American  States.  The  solu- 
tion of  this  problem,  then,  involves  close  study  of  definite  prob- 
lems, and  it  is  our  opinion  that  such  consideration  is  of  funda- 
mental importance  in  the  matter  of  extending  and  furthering 
happy  relations  with  our  neighboring  Republics.  This  could 
best  be  done,  probably,  through  a  special  committee  of  this 
conference.  Studies  should  be  made  at  first  hand  and  the 
results  reported  as  widely  as  possible. 

ii. 

At  the  present  conference,  as  at  the  one  held  five  years  ago,  the 
paramount  need  of  increased  banking  capital  and  an  increase  in  the 
circulating  medium  was  given  special  consideration  by  the  financial 
delegation  representing  Salvador.  Since  1915,  as  your  committee 
believes,  there  has  been  a  marked  tendency  toward  the  establishment 
of  branch  banks  in  Latin- American  countries  by  banking  institu- 
tions of  our  country,  and  that  the  process  of  creating  new  branches 
in  new  localities  is  a  continuing  one,  and,  in  a  more  limited  way, 
perhaps,  the  creation  of  independent  banking  concerns  by  banking 
organizations  has  been  inaugurated.  Legislation  through  the  enact- 
ment of  the  Federal  reserve  act,  as  well  as  the  passage  of  the  Edge 
bill,  is  favorable  to  the  growth  of  invested  capital  in  other  countries, 
so  Salvador  may  reasonably  hope  for  independent  capital.  Still,  in 
the  opinion  of  your  committee,  the  location  of  branch  banks,  even 
without  issuing  powers,  would  be  most  beneficial  because  of  the 
resultant  employment  of  such  forms  of  currency  as  may  be  sent  into 
the  territory  intended  to  be  covered  by  such  new  branches  in  lending 
and  investment  operations.  These  will  have  the  effect  of  increasing 
the  actual  money  per  capita  in  the  Republic  entered.  The  establish- 
ment of  such  branches  or  of  independent  banks  supported  by  capital 
from  the  United  States  would  not  only  tend  to  meet  the  recognized 
needs  of  Salvador  with  respect  to  an  increase  in  banking  facilities 
and  a  greater  supply  of  currency,  but  would  become  at  once  a  poten- 
tial factor  in  developing  trade  relations  between  our  respective  coun- 


160  SECOND   PAN   AMERICAN    FINANCIAL   CONFERENCE. 

tries,  involving  not  only  the  buying  and  selling  of  merchandise,  but 
the  question  of  commercial  credits  as  well.  Believing  that  Salvador 
is  typical  of  other  Latin- American  countries  into  which  banking 
capital  from  our  own  country  has  not  yet  entered,  we  beg  to  make 
the  following  recommendation  to  the  general  committee  on  forms 
and  resolutions : 

That  there  be  appointed  a  committee  charged  with  the  respon- 
sibility of  making  a  careful  study  of  the  banking  laws  of  Sal- 
vador and  other  Central  and  South  American  countries,  first, 
with  the  view  to  suggest  such  changes  in  the  laws  as  will  enable 
their  respective  banking  systems  to  respond  most  readily  and 
effectively  to  the  seasonal  and  unusual  demands  of  commerce 
and  industry;  and,  second,  to  propose  such  changes  as  will 
attract  banking  capital  from  other  countries. 

We  are  told  by  the  Salvadorean  representatives  that  local  capital 
is  timid  and  to  a  degree  suspicious,  and  your  committee  is  of  the 
opinion,  furthermore,  that  employment  of  foreign  banking  capital 
would  render  more  stable  the  available  supply  of  local  capital  and 
credit.  The  actual  establishment  of  an  institution,  whether  bank 
or  branch,  must  of  necessity  be  left  to  negotiation  between  the 
agencies  interested  in  the  Republic  of  Salvador  and  the  representa- 
tives of  private  capital  seeking  to  expand  their  banking  facilities  in 
the  Latin- American  countries,  and  to  both  of  these  we  commend  the 
subject  of  increased  banking  capital  in  Salvador  as  one  of  interest 
and  the  source  of  practicable  as  well  as  mutual  benefit. 
Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  EL  SALVADOR, 
JOSE  E.  SUAY,  Chairman. 
W.  S.  ROWE,  Vice  Chairman. 


URUGUAY. 


REPORT  OF  THE  CONFERENCE  COMMITTEE. 


The  honorable  the  SECRETARY  OF  THE  TREASURY  OF  THE  UNITED 
STATES. 

SIR  :  The  conference  committee  for  Uruguay  desires  to  call  atten- 
tion to  the  satisfactory  condition  of  the  finances  of  Uruguay,  its 
increasing  wealth,  and  its  strong,  favorable  trade  balance;  the 
development  by  its  Government  of  port  and  transportation  facili- 
ties and  other  means  of  external  and  internal  communication,  and 
in  particular  its  excellent  educational  system. 

The  committee  recommends  to  the  favorable  consideration  of  the 
Government  and  the  banking  and  commercial  interests  of  the  United 
States : 

1.  The    further    development    of    maritime    transportation 
facilities    for    passengers    and    freight.      The    committee    has 
adopted  two  resolutions  with  a  view  to  the  fulfillment  of  this 
purpose,  copies  of  which  are  attached  to  this  report.    The  United 
States  section  of  the  committee  has  also  adopted  a  resolution 
favoring  the  award  to  the  Government  of  Uruguay  by  the  repa- 
rations commission  of  the  eight  German  ships  seized  by  that 
Government   during  the   war.     A   copy  of  this  resolution   is 

attached.  Bancroft! 

2.  The  further  consideration   of  commercial  conditions  for 
the  purpose  of  effecting  a  larger  interchange  of  commodities 
between  the  two  countries.     In  this  connection  the  committee 
heartily  indorses  the  arrangement  made  between  the  chambers 
of  commerce  of  the  two  countries  for  the  arbitration  of  commer- 
cial disputes. 

3.  The  study  of  industrial  conditions  in  Uruguay  with  a  view 
to  the  establishment  of  industries  there  or  their  encouragement 
with  United  States  capital  and  industrial  skill. 

4.  The  publication  of  a  descriptive  pamphlet  on  Uruguay  for 
general  distribution  in  the  United  States.    The  committee  has 
appointed  a  subcommittee  to  work  in  cooperation  with  the  Uru- 

14970—21 11  161 


162  SECOND  PAN  AMERICAN   FINANCIAL,  CONFERENCE. 

guayan  minister  in  Washington  and  the  Uruguayan  consul  in 
New  York  to  revise  and  bring  up  to  date  the  descriptive  pam- 
phlet prepared  in  1915  by  the  Uruguayan  conference  committee 
of  the  First  Pan  American  Financial  Conference. 

In  the  committee's  opinion  the  excellent  economic  and  financial 
condition  of  Uruguay  fully  justifies  a  great  extension  of  financial 
relations  between  the  United  States  and  Uruguay  when  the  world's 
economic  situation  shall  have  become  normal. 
Bespectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  URUGUAY, 

RICARDO  VECINO,  Chairman. 

HARRY  A.  WHEELER,  Vice  Chairman. 


VENEZUELA. 


REPORT  OF  THE  CONFERENCE  COMMITTEE, 


The  honorable  the  SECRETARY  or  THE  TREASURY  OF  THE  UNITED 
STATES. 

"SiR:  The  conference  committee,  consisting  of  the  official  delegation 
and  of  the  United  States  members,  organized  on  January  19,  1920, 
with  the  election  of  Dr.  Vicente  Lecuna  (president  of  the  Interna- 
tional High  Commission,  Venezuelan  section)  as  chairman  of  the 
conference  committee;  of  Mr.  Kobert  H.  Patchin,  of  New  York,  as 
vice  chairman;  and  of  Mr.  Clarence  H.  Haring,  of  Connecticut,  as 
secretary. 

The  conference  committee  has  surveyed  the  financial,  commercial, 
and  economic  relations  of  Venezuela  with  the  United  States  and  the 
other  Republics  of  America. 

The  official  delegation  of  Venezuela,  consisting  of  Dr.  Vicente 
Lecuna,  Mr.  Enrique  Perez  Dupuy,  and  Dr.  Nicholas  Veloz  Goiticoa, 
submitted  a  comprehensive  report  prepared  by  them  for  the  Interna- 
tional High  Commission,  dealing  with  all  topics  agreed  upon  by  the 
Governments  of  the  American  Republics  for  submission  to  the  Second 
Pan  American  Financial  Conference.  That  report  abounds  in  so 
much  valuable  and  pertinent  material  relative  to  the  present  finances, 
commerce,  transportation,  and  other  economic  conditions  of  Vene- 
zuela that  the  committee  has  not  ventured  to  traverse  all  of  that 
ground,  but  transmits  the  report  herewith  (with  a  translation  in 
English)  with  an  urgent  recommendation  that  it  be  published  in  both 
Spanish  and  English  as  a  part  of  the  official  proceedings  of  this 
conference. 

As  a  result  of  its  deliberations,  the  conference  committee  begs  to 
submit  the  following  report : 

PRESENT  CONDITIONS. 

Venezuela  has  emerged  from  the  war  period  with  greatly  enhanced 
prosperity,  and  with  several  pressing  economic  problems  requiring 
early  solution.  One  effect  of  the  war  has  been  to  emphasize  the 
naturally  reciprocal  relation  of  Venezuela  and  the  United  States. 

163 


164  SECOND  PAX   AMERICAN   FINANCIAL  CONFERENCE. 

PUBLIC    FINANCES. 

The  public  finances  of  Venezuela  are  in  a  gratifying  condition, 
the  total  public  debt  having  been  reduced  from  190,000,000  bolivares 
($38,000,000  United  States)  in  1901  to  142,000,000  bolivares  ($28,- 
500,000  United  States)  in  1918.  Through  all  the  trials  imposed  by 
the  war  upon  international  finance  Venezuela  punctually  met  its 
public- debt  service. 

COMMERCE  WITH  THE  UNITED  STATES. 

Prior  to  the  outbreak  of  the  European  war  the  United  States,  in 
the  year  1912,  participated  in  the  total  foreign  commerce  of  Vene- 
zuela to  the  following  extent : 

Per  cent. 

United  States  '  proportion  of  total  Venezuelan  imports 33 

United  States'  proportion  of  total  Venezuelan  exports 38 

United  States'  proportion  of  total  Venezuelan  trade 3fr 

In  1917  the  United  States'  share  of  this  commerce  had  increased 
as  follows: 

Per  cent. 

United  States'  proportion  of  all  Venezuelan  imports 70 

United  States'  proportion  of  all  Venezuelan  exports 55 

United  States'  proportion  of  total  Venezuelan  trade 62 

COMMERCE   WITH   EUROPE. 

The  greater  part  of  Venezuelan  foreign  commerce  other  than  with 
the  United  States  is  with  Europe.  It  is  natural  and  just  to  expect 
a  certain  readjustment  and  increase  of  the  proportion  of  the  trade 
formerly  held  by  Europe,  as  compared  with  that  of  the  United  States, 
but  the  United  States  must  nevertheless  continue  to  be  considered 
Venezuela's  chief  market  for  raw  materials.  This  is  equally  to  the 
advantage  of  Venezuela  as  an  exporter  of  natural  products  and  of 
the  United  States  as  a  consumer  of  raw  materials,  indispensable  to 
prosperity  and  stable  operation  of  labor  and  industries. 

During  the  war  the  manufactured  products  of  the  United  States 
have  become  better  known  to  the  people  of  Venezuela,  and  their  con- 
tinued exportation  to  that  country  is  necessary  in  partial  payment 
for  the  greater  value  of  imports  from  Venezuela,  the  trade  balance 
being  always  adverse  to  the  United  States. 

TRANSPORTATION. 

The  fact  that  the  natural  relations  between  Venezuela  and  the 
United  States  are  truly  reciprocal  is  proven  by  the  fact  that  this 
interchange  of  products,  both  before  and  since  1914,  has  been  accom- 
plished despite  meager  steamship  communication  as  compared  with 


KEPORT   OF   THE    CONFERENCE    COMMITTEE VENEZUELA.          165 

the  steamship  facilities  between  Venezuela  and  Europe.  Before  the 
war  only  one  regular  line  connected  the  United  States  and  Venezuela, 
as  against  seven  steamship  lines  operating  between  the  chief  Vene- 
zuelan ports  and  England,  Spain,  France,  Italy,  and  Holland.  Two 
American  lines  are  now  operated,  but  only  one  operates  passenger 
vessels. 

The  abnormal  conditions  which  have  existed  during  the  war,  and 
the  suspension  of  shipping  facilities  between  Venezuela  and  Europe, 
have  doubtless  contributed  to  some  extent  to  increase  the  commerce 
between  Venezuela  and  the  United  States.  As  normal  conditions  are 
rapidly  being  restored,  it  is  only  fair  to  assume  that  the  same  facili- 
ties which  formerly  existed  between  Venezuela  and  Europe  will  be 
reestablished,  and  even  increased;  and  consequently,  if  the  United 
States  is  to  hold  the  commerce  which  has  been  created  during  the  war, 
it  will  be  absolutely  necessary  to  provide  additional  transportation 
facilities. 

In  this  connection  it  should  be  pointed  out  that  the  interchange  of 
commerce  depends  not  only  on  the  character  and  price  of  goods  but 
largely  upon  the  personal  relations  between  merchants.  So  far,  the 
travel  between  Venezuela  and  the  United  States  has  been  greatly 
handicapped.  At  the  present  time  the  facilities  for  passenger  travel 
to  the  United  States  are  inadequate  as  compared  with  those  provided 
by  the  European  lines.  In  order  to  induce  Venezuelan  merchants  more 
freely  to  visit  the  United  States,  or  to  come  to  the  United  States  on 
their  way  to  and  from  Europe,  passenger  facilities  should  be  greatly 
increased. 

The  Venezuela  conference  committee  recognizes  that  improved 
steamship  communication  is  an  essential  factor  in  Pan  American  co- 
operation, and  recommends  to  the  United  States  Shipping  Board  and 
«o  the  existing  American  steamship  companies  calling  at  Venezuelan 
ports  the  early  enlargement  and  improvement  of  their  services  for 
both  passengers,  freight,  and  mails ;  and  also  recommends  to  the  In- 
ternational High  Commission  that  the  needs  of  Venezuela  for  im- 
proved steamship  communication  with  the  other  countries  of  America 
be  given  careful  consideration. 

The  natural  advantages  of  the  ports  of  Venezuela  for  transship- 
ment are  manifest ;  and,  in  the  opinion  of  the  committee,  the  interests 
of  Venezuela  will  be  distinctly  served  by  a  reduction  of  port  dues, 
tonnage  taxes,  and  other  Government  charges  on  shipping  to  such 
points  as  will  cover  the  actual  cost  of  the  services  rendered.  This 
would  be  in  conformity  with  the  practice  of  all  nations  which  seek 
to  attract  the  world's  shipping  to  their  ports.  The  committee  also 
recommends  that  the  present  port  regulations  of  Venezuela  be  altered 
so  as  to  permit  the  simultaneous  loading  and  unloading  of  vessels. 


166  SECOND  PAN  AMERICAN  FINANCIAL,  CONFERENCE. 

UNIFORM    LEGISLATION. 

It  is  further  recommended  to  the  official  delegation,  and  through 
them  to  the  Venezuelan  Government,  that  the  Government  of  Vene- 
zuela cooperate,  through  the  International  High  Commission,  with 
the  other  countries  of  South  America  in  the  establishment  of  uniform 
customs  regulations,  and  legislation  and  regulations  affecting  bills  of 
exchange,1  checks,  bills  of  lading,  warehouse  receipts,  contracts  in 
foreign  trade,  patent  and  copyright  laws,  and  uniform  admiralty 
laws. 

COMMERCIAL  AGREEMENTS. 

The  encouragement  of  commerce  between  Venezuela  and  the 
United  States  through  the  negotiation  of  commercial  agreements, 
such  as  are  authorized  in  the  present  American  tariff  law,  is  desir- 
able in  principle,  as  a  means  of  securing  to  each  country  reciprocal 
advantages  in  ftie  markets  of  the  other. 

SILVER. 

While  the  currency  of  Venezuela  is  on  a  gold  basis,  and  the 
finances  of  the  country  in  a  sound  and  prosperous  condition,  the 
rising  price  of  silver  presents  to  that  Government  a  serious  problem 
in  connection  with  its  subsidiary  coinage  very  similar  in  character 
to  that  which  will  confront  the  Government  of  the  United  States  if 
the  price  of  silver  should  reach  a  much  higher  point.  As  this  problem 
is  common,  in  a  greater  or  less  degree,  to  all  countries  with  a  silver 
subsidiary  coinage,  the  Venezuelan  conference  committee  recom- 
mends that  it  be  given  the  early  attention  of  the  International  High 
Commission. 

Venezuela  has  $10,000,000  in  silver  in  circulation. 

It  needs  more  now  than  it  did  five  years  ago,  due  to  the  fact  that 
its  commerce  has  grown. 

During  the  harvest  season  silver  has  gravitated  toward  the  har- 
vesting centers,  returning  later  to  the  28  agencies  of  the  Bank  of 
Venezuela. 

During  the  last  three  years  the  return  of  silver  has  been  in  lessen- 
ing quantities.  In  later  years  there  has  been  an  increased  use  of 
bank  notes  guaranteed  by  gold  deposits. 

Due  to  the  increase  in  value  of  silver  in  the  subsidiary  coins,  it  is 
feared  that  this  currency  may  disappear  from  circulation. 

1  The  Hague  rules  of  1912  relating  to  bills  of  exchange  and  checks  with  certain  modi- 
fications recommended  by  the  International  High  Commission  were  incorporated  into  the 
Venezuelan  Commercial  Code  effective  in  December,  1919. — Editor. 


KEPORT  OF  THE  CONFERENCE  COMMITTEE — VENEZUELA.      167 

Venezuela,  with  reference  to  her  population,  needs  more  silver 
coins  than  other  countries,  because  the  use  of  checks  and  bank  notes 
is  not  so  general. 

The  bank  notes  of  the  four  national  banks  of  issue  in  Venezuela 
are  exchangeable  for  gold  or  silver  on  presentation  at  any  of  the  28 
agencies  of  the  Bank  of  Venezuela. 

The  Venezuelan  Government  is  now  preparing  to  mint  a  gold 
coin  worth  10  bolivares  (equal  $2  United  States  gold). 

Venezuela's  monetary  system  is  the  same  as  that  of  France  before 
the  war;  but  silver  coins  in  Venezuela,  even  those  0.900  fine,  are  re- 
ceived as  legal  tender  only  to  a  limited  amount. 

METRIC    SYSTEM. 

One  obstacle  to  the  accomplishment  of  a  greater  degree  of  eco- 
nomic Pan  Americanism  is  the  difference  between  the  metric  system 
of  weights  and  measures  everywhere  legally  established  and  univer- 
sally used  in  Latin- American  countries  and  the  English  standard 
which,  notwithstanding  its  obvious  defects,  continues  to  obtain  in  the 
United  States.  The  tariff  laws  and  customs  administration  of  all  the 
other  Republics  of  America  are  in  metric  terms.  American  ex- 
porters are  increasingly  accommodating  themselves  to  the  use  of  the 
metric  system  in  foreign  commerce.  It  is  steadily  growing  in  do- 
mestic industry.  If  it  could  be  established  in  the  United  States,  a 
long  step  would  be  taken  toward  more  effective  commercial  relations 
with  Latin  America  in  particular,  and  with  many  other  countries  of 
the  world. 

As  a  partial  step  to  this  end,  the  committee  strongly  recommends 
increased  instruction  in  the  metric  system  in  the  public  schools, 
counsels  exporters  to  its  wider  use,  and  advises  importers  to  adopt  it 
wherever  possible.  The  practice  of  many  exporters  in  using  metrical 
equivalents,  wherever  they  use  the  English  standards  in  catalogues, 
price  lists,  labels,  etc.,  has  been  most  useful,  and  this  method  should 
be  more  generally  followed. 

INCREASED  STUDY  OF  THE  SPANISH  LANGUAGE. 

The  increased  study  of  the  Spanish  language  in  the  high  schools, 
colleges,  and  universities  of  the  United  States,  and  through  private 
instruction,  with  but  slight  governmental  or  business  encouragement, 
is  in  itself  evidence  of  the  cultural  richness  of  this  language  and  of 
Spanish  literature,  as  well  as  of  a  growing  public  appreciation  of  its 
value  as  a  commercial  medium.  A  large  part  of  the  present  United 
States  was  formerly  Spanish,  and  Spanish  influence  in  the  develop- 
ment of  the  United  States  has  been  far  more  potent  than  is  generally 
realized.  Indeed,  even  at  the  present  day  it  must  not  be  forgotten 


168  SECOND  PAN  AMERICAN   FINANCIAL  CONFERENCE. 

that  the  United  States  has  extensive  territory  in  Porto  Eico  and  the 
Philippine  Islands,  where  Spanish  is  the  language  of  the  people. 
Furthermore,  the  literature  and  traditions  of  Spain  itself  have  come 
down  to  us  as  a  heritage  from  that  nation. 

The  committee  cordially  urges  the  more  general  study  of  Spanish 
for  cultural  quite  as  much  as  for  commercial  reasons.  In  Latin 
America  the  study  of  English  is  increasing  in  a  corresponding  man- 
ner, and  it  is  hoped  will  meet  with  the  encouragement  of  all  govern- 
ments. 

The  considerable  number  of  the  youth  of  Venezuela  attending  edu- 
cational institutions  in  the  United  States  is  gratifying;  and  the  at- 
tention which  colleges  and  universities  are  giving  to  the  study  of 
Latin- American  affairs  and  the  special  measures  which  the  universi- 
ties of  America  are  taking  to  attract  students  from  the  sister  republics 
is  most  commendable  and  useful. 

As  the  first  Pan  American  Financial  Conference  paved  the  way  for 
the  negotiation  of  agreements  for  commercial  arbitration  between 
commercial  organizations  in  Latin  America  and  the  Chamber  of  Com- 
merce of  the  United  States  representing  American  business,  the  com- 
mittee has  learned  with  gratification  that  the  Chamber  of  Commerce 
of  Caracas  has  instructed  two  of  the  members  of  the  Venezuelan  offi- 
cial delegation  (who  are  also  members  of  that  chamber)  to  negotiate 
with  the  Chamber  of  Commerce  of  the  United  States  an  agreement 
for  the  arbitration  of  commercial  disputes.  The  committee  feels  that 
such  a  mechanism  will  go  far  to  improve  trade  relations  between  the 
two  countries. 

The  committee  is  moved  to  record  its  appreciation  of  the  construc- 
tive accomplishments  of  the  International  High  Commission  and  its 
central  executive  council  as  a  permanent  body  for  realizing  the  pur- 
poses of  the  Pan  American  financial  conferences. 

The  committee  recommends  that  the  official  delegation  recommend 
to  the  Venezuelan  Government  that  it  shall  deposit  in  the  library  of 
the  Pan  American  Union  two  copies  of  all  informative  official  publi- 
cations, maps,  and  other  data;  that  it  consider  the  advisability  of 
preparing  a  comprehensive,  standard  handbook  in  English  describ- 
ing the  financial,  commercial,  material,  and  other  conditions  of  Vene- 
zuela to  be  distributed  through  the  Pan  American  Union;  that  it 
deposit  in  the  Pan  American  Union  for  exhibit,  whenever  found  de- 
sirable and  practicable,  films  descriptive  of  Venezuelan  life  and  re- 
sources; and  that  every  effort  be  made  to  make  the  Pan  American 
Union  a  practical,  up-to-date,  central  bureau  of  information. 

Respectfully  submitted. 

THE  CONFERENCE  COMMITTEE  FOR  VENEZUELA, 

VICENTE  LECUNA,  Chairman. 

ROBERT  H.  PATCHIN,  Vice  Chairman. 


INDEX. 


Page. 

Acceptances,  resolution  on 13,  57 

Aldao,  Dr.  Ricardo  C.,  address 55 

Alexander,  Hon.  J.  W.,  chairman  of  the  committee  on  transportation  and 

communications + 45 

Arag6n  y  Etchart,  Dr.  Florencio,  address 50-51 

Argentina : 

Conference  committee 21 

Report  of 65-68 

Argentine  and  American  Chamber  of  Commerce,  68;  bank- 
ing, 66;  census,  67;  commercial  arbitration,  67;  commer- 
cial attache's,  68;  monetary  unit,  66;  taxation,  67;  trade- 
marks, 68;  transportation,  65-66;  uniform  legislation,  68. 
Banks  and  banking: 

Argentina,  66;  Chile,  89-90;  Colombia,  94;  Cuba,  100;  Mexico,  139; 
Nicaragua,  141 ;  Peru,  155 ;  Salvador,  15&-160. 

Resolution  on  establishment  of  branches 57 

Banquet  tendered  delegates 54 

Barrett,  Hon.  John: 

Ex  officio  member  of  all  group  committees 19 

Remarks 43 

Bolivia  : 

Conference  committee 22 

Report  of 69-73 

Capital  and  credit  facilities  and  necessities,  71 ;  chamber  of 
commerce,  72;  commercial  attache's,  72;  commercial  trav- 
elers, 72  ;  debt,  71 ;  effects  of  war,  69 ;  financial  needs,  70 ; 
fiscal  system,  71 ;  international  commerce,  69,  72 ;  patents 
and  copyrights,  72 ;  postal  relations,  72 ;  railways,  need  of, 
70-71 ;  wireless  system,  72. 

Recommendation  of  the  extension  of  financial  aid  to  Europe  by 
the  United  States  through  the  purchase  of  Government  securi- 
ties of  the  republics  of  Central  and  South  America  now  held 

in   Europe 52 

Brazil : 

Conference  committee 28 

Report  of 74-87 

Capital  and  credit  facilities,  77-78;  commercial  travelers, 
84 ;  debt,  79-SO ;  effects  of  the  war,  74-76 ;  financial  needs, 
76-77;  fiscal  system,  80-82;  gold  clearance  fund,  84; 
recommendations,  87;  transportation  and  communications, 
82-83,  85;  uniformity  of  legislation,  86-87. 

169 


170  INDEX. 

Page- 

Budget  system 50 

Address  on ' 49 

Cable  and  telegraphic  service,  Colombia 7 9& 

(See  Transportation  and  communications.) 
Capital  and  credit  facilities : 

Bolivia,  71;  Brazil,  77-78;  Ecuador,  108;  Guatemala,  114-115;  Haiti, 

121;  Honduras,  126-127.     (See  also  Financial  needs.) 
Census : 

Argentina 67 

Resolution  on 14,  58 

C4spedes,  Dr.  Carlos  Manuel  de : 

Member  of  committee  on  resolutions 56 

Presiding  officer  at  the  first  general  session 44 

Chambers  of  commerce : 

Argentina,  68 ;  Bolivia,  72 ;  Nicaragua,  141-142. 

Checks,  resolution  on  uniformity  of 14r 

Chile : 

Conference  committee 24 

Report  of 88-92 

Banking  and  currency,  89-90 ;  commerce,  91-92 ;  commercial 
arbitration,  91;  nitrate  situation,  88-89;  public  utilities, 
91;  transportation,  90-91. 

Debt,  public ~_ 46 

Field  for  investment 4$ 

Classification  of  merchandise : 
Paraguay,  149 ;  Peru,  156. 
Colombia : 

Conference  committee 25 

Report  of 93-98 

Banking  facilities,  94;  cable  and  telegraphic  service,  96; 
commercial  travelers,  96;  currency,  95;  debt,  95;  distribu- 
tion of  information  concerning  ore  deposits  and  industries, 
96;  effects  of  the  war,  93-95;  fiscal  system,  95;  freight 
rates,  96;  patents,  trade-marks,  and  copyrights,  96;  rail- 
ways, 93-94;  recommendations,  96-98;  warehouse  facili- 
ties, 96. 
Commerce : 

Bolivia,  69,  72;  Chile,  91-92;  Cuba,  100;  Peru,  154;  Uruguay,  161; 

Venezuela,  164. 
Commercial  arbitration : 

Argentina,  67 ;  Chile,  91 ;  Guatemala,  118 ;  Nicaragua,  142 ;  Paraguay, 
149 ;  Uruguay,  161 ;  Venezuela,  166-168. 

Resolution  on 15, 

Commercial  attache's: 

Argentina,  68 ;  Bolivia,  72. 

Resolution  concerning 14, 

Commercial  intercourse : 

Ecuador,  110-111 ;  Guatemala,  116-117 ;  Haiti,  123 ;  Honduras,  131 ; 

Mexico,  137 ;  Panama,  146. 
Commercial  travelers : 

Bolivia,  72 ;  Brazil,  84 ;  Colombia,  96 ;  Paraguay,  149. 


; 


INDEX.  171 

Committees :  Page. 

Group  conference 21-39 

Resolutions 20 

Transportation  and  communications 20 

Cuba: 

Conference  committee 26 

Report  of 99-103 

Banking  system,  100 ;  commerce  with  the  United  States,  100 ; 
currency,  99;  effects  of  the  war,  100;  relations  with  the 
United  States,  99-100;  recommendations,  102;  sugar,  100, 
102 ;  taxation  means  of  paying  ordinary  expenses,  101. 
Currency : 

Address  on 46-49 

Chile,  89-90;  Colombia,  95;  Cuba,  99. 
Debt: 

Bolivia,  71 ;  Brazil,  79-80 ;  Colombia,  95 ;  Mexico,  136 ;  Peru,  155. 
Documentation.     (See  Transportation  and  communications.) 
Dominican  Republic : 

Conference  committee 27 

Report  of 104-106 

Financial  conditions,  104 ;  loan  for  improvement  of  roads  and 
ports,  104 ;  measures  which  the  Republic  should  take,  104 ; 
measures  which  the  United  States  should  take,  104. 

Duties,  prohibitive,  resolution  on 59 

Ecuador : 

Conference  committee 28 

Report  of 107-112 

Capital  and  credit  facilities,  108;  commercial  intercourse, 
measures  to  facilitate,  110-111 ;  effects  of  the  war,  107-108, 
109-110;  national  credit  and  the  factors  affecting  it,  108- 
109;  recommendations,  112;  transportation  facilities,  109- 
110 ;  uniformity  of  legislation,  111-112. 
Education : 

For  foreign  service,  58 ;  Mexico,  139 ;  Venezuela,  167. 
Elizalde,  Dr.  Rafael  H. : 

Member  of  committee  on  resolutions 56 

Presiding  officer  at  third  general  session 45 

Federal  reserve  bank  of  New  York,  visit  of  delegates  to 55 

Financial  needs: 

Bolivia,  70;  Brazil,  76-77;  Dominican  Republic,  104;  Mexico,  137; 
Nicaragua,  143-144;  Peru,  155-156.     (See  also  Capital  and  credit 
facilities.) 
Fiscal  system: 

Address  on 47-49 

Brazil,  80-82 ;  Colombia,  95. 

Foreign  corporations,  resolution  on 13,  57,  60 

Freight  rates,  Colombia 96 

General  sessons__'_ 40-^1, 43-60 

Glass,  Carter: 

Addresses 43,54 

Announcements 44 

Presiding  officer 17, 43 


172  INDEX. 

Gold  clearance  fund:  Page. 

Brazil,  84 ;  Paraguay,  149. 
Resolution  on 13,  57 

Guatemala : 

Conference  committee 29 

Report  of 113-119 

Capital  and  credit  facilities,  114-115 ;  commercial  arbitration, 
118;  commercial  intercourse,  116-117;  effects  of  the  war, 
113;  patents  and  copyrights,  118;  port  dues,  119;  recom- 
mendations, 118;  trade-mark  convention,  118;  transporta- 
tion facilities,  115-116;  uniformity  of  legislation,  117-118. 
Haiti : 

Conference  committee 30 

Report  of 120-124 

Capital  and  credit  facilities,  121;  commercial  intercourse, 
123 ;  effects  of  the  war,  120-121,  122-123 ;  national  credit 
and  the  factors  affecting  it,  121-122 ;  transportation  facili- 
ties, 122-123;  trade-mark  convention,  124;  uniformity  of 
legislation,  123-124. 

Harding,  Hon.  W.  G.  P.,  address 51-52 

Honduras : 

Conference  committee 31 

Report  of 125-133 

Capital  and  credit  facilities,  126-127;  commercial  inter- 
course, 131 ;  effects  of  the  war,  125-126,  128-131 ;  national 
credit  and  the  factors  affecting  it,  127-128;  recommenda- 
tions, 132-133;  transportation  facilities,  128-131;  uni- 
formity of  legislation,  131-133. 

International  High  Commission 44 

Resolution  adopted  for  change  of  name 13,  56,  59 

International  Trade-Mark  Bureau  at  Havana,  resolution  on 58, 60 

(See  also  Trade-marks.) 
Investments : 

Mexico,  138-139 ;  Paraguay,  148-150 ;  Uruguay,  161. 

Lansing,  Hon.  Robert,  address 43 

Loans : 

Dominican  Republic 104 

Granted  to  Latin  American  countries  by  repaying  Latin  American 

obligations  held  in  Europe 15,  59 

Marshall,  Hon.  Thomas  R 55 

Martinez  Sobral.  Dr.  Enrique,  address 52 

McAdoo,  Hon.  William  G. : 

Addresses  44, 55 

Presiding  officer  at  second  general  session 44 

McCormick,  Hon.  Medill,  address 49 

Members  of  group  committees.     (See  Committees.) 
Metric  system.     (See  Weights  and  measures.) 
Mexico : 

Conference  committee 32 

Report  of 134-139 

Banking  conditions,  139;  commercial  intercourse,  137;  debt, 
136;  education,  139;  effects  of  the  war  on  Mexican  trade, 
134;  financial  neeAs,  137;  foreign  investments,  138-139; 
mining  investments,  139;  monetary  situation,  137,  138; 
railroads,  135-136;  revenues,  136;  transportation,  134-135. 


INDEX.  173 

Page. 

Monetary  situation,  Mexico 137-138 

Monetary  unit : 

Argentina,  66 ;  Paraguay,  152. 
Moore,  Hon.  John  Bassett : 

Chairman  of  committee  on  resolutions 20 

Address  on  the  work  of  the  International  High  Commission 44 

Address,  Pan  American  Society  banquet 55 

National  credit  and  the  factors  affecting  it : 

Brazil,  79-80;   Ecuador,  108-109;   Haiti,   121-122;   Honduras,  127- 
128;  Nicaragua,  141. 

New  York  City,  trip  to 55 

Nicaragua : 

Conference    committee 33 

Report   of 142-143 

Agricultural  bank,  141;  chambers  of  commerce,  141-142; 
commercial  arbitration,  142 ;  effects  of  the  war,  140 ;  finan- 
cial condition,  143,  144;  national  credit  and  the  factors 
affecting  it,  141;  recommendations,  142;  transportation, 
140. 

Officers  of  the  conference 17-18 

Official    delegations 19, 21-39 

Panama : 

Conference    committee 34 

Report  of 145-147 

Commercial    intercourse,    146;    transportation    needs,    145- 

146;  uniformity  of  legislation,  146-147. 
Paraguay : 

Cbnference  committee 35 

Report  of 148-153 

Classification  of  merchandise,  149;  commercial  arbitration, 
149 ;  commercial  travelers,  149 ;  customs  regulations,  149 ; 
gold  clearance  fund,  149;  increased  immigration,  152;  in- 
vestment of  capital,  148,  150;  monetary  system,  152; 
needs  of,  148;  patent  and  trade-mark  conventions,  148; 
resources,  152-153;  transportation,  150-151;  uniformity 
of  legislation,  149. 
Paredes,  Gen.  Juan  E. : 

Member  of  committee  on  resolutions 56 

Presiding  officer  at  the  fifth  general  session 51 

Patents  and  copyrights: 

Bolivia,  72 ;  Colombia,  76 ;  Guatemala,  118 ;  Paraguay,  148. 

Resolution    on 14,  58 

(See  also  Trade-marks.) 

Payne,  Hon.  John  Barton,  address 44 

Peru: 

Conference  committee 

Report  of —  154-156 

Bank,  establishment  of  branches,  155 ;  classification  of  mer- 
chandise, 156;  commerce,  increase  of,  154;  debt,  155; 
financial  needs,  155-156;  natural  resources,  154;  rail- 
road facilities,  need  of,  154;  recommendations,  154;  uni- 
formity of  legislation,  156;  wireless  communications, 
lack  of,  156. 


174  INDEX. 

Peters,  Hon.  Andrew  J. :  Page. 

Address 46 

Member  of  committee  on  resolutions 56 

Philadelphia,  trip  to 55 

Port  dues,  Guatemala 119 

Postal  facilities: 

Bolivia,  72 ;  Brazil,  84.     (See  also  Transportation  and  communica- 
tions. ) 

Preliminary  meeting  of  official  delegations 42 

Public  utilities,  Chile 91 

Railroads : 

Bolivia,  70-71;  Colombia,  93-94;  Mexico,  135-136;  Peru,  154.     (See 

also  Transportation  and  communications.) 
Raw  materials: 

Resolution  on 15 

Reservation  to  resolution  on 16 

Recommendations : 

Brazil,  87;  Colombia,  97-98;  Cuba,  102;  Dominican  Republic,  104; 
Ecuador,   112;    Guatemala,   118;    Honduras,   132-133;   Nicaragua, 
142;  Peru,  154. 
Reports  of: 

Group  conference  committees •. 45,  65-168 

Argentina,  65-68;  Bolivia,  69-73;  Brazil,  74-87;  Chile,  88-92; 
Colombia,  93-98 ;  Cuba,  99-103 ;  Dominican  Republic,  104-106 ; 
Ecuador,  107-112;  Guatemala,  113-119;  Haiti,  120-124;  Hon- 
duras, 125-133;  Mexico,  134-139;  Nicaragua,  140-144;  Pan- 
ama, 145-147;  Paraguay,  148-153;  Peru,  154-156;  Salvador, 
157-160;  Uruguay,  161-162;  Venezuela,  163-168. 

Committee  on  resolutions 54,  56-60 

Committee  on  transportation  and  communications 45,  56,  61-64 

Resolution  adopting  part  of 13,  56,  59 

Secretary  general  to  the  Secretary  of  the  Treasury 12,  54 

Secretary  of  the  Treasury  to  the  President 5-11 

Resolutions   adopted 13-15 

Reservations    to 15-16 

Report  of  committee  on  resolutions 56-60 

Resources,  natural: 

Chile,   nitrate,  88-89;   Cuba,   sugar,   100,   102;   Paraguay,   152-153; 
Peru,  154. 

Revenues,  Mexico 136 

Robles,  Dr.  Victor,  address 46 

Rodriguez  Beteta,  Dr.  Virgilio,  address 49 

Rowe,  Hon.  Leo  S. : 

Secretary  general  of  the  conference 18,  42 

Address 55 

Announcements 42,45 

Report 12,  54 

Salaberry,  Dr.  Domingo  E. : 

Address 54 

Member  of  committee  on  resolutions 56 

Remarks- _  54 


INDEX.  175 

Salvador :  Page. 

Conference  committee 37 

Report  of 157-160 

Banking  facilities  and  trade  relations,  159-160;  transporta- 
tion and  communications,  157-159. 
Sampaio,  Dr.  Carlos  Cesar  de  Oliveira: 

Address 53 

Member  of  the  committee  on  resolutions 56 

Taxation 50 

Argentina,  67;  Cuba,  101. 

Resolution  on 13, 16,  57 

Telegraphic  service.     (See  Transportation  and  communications.) 
Tejada,  Dr.  Luis: 

Addresses 52-53,55 

Member  of  the  committee  on  resolutions 56 

Thompson,  Hon.  Huston,  address 45 

Topics  discussed  *at  conference 40-41 

Trade-mark  convention : 

Argentina,  68 ;  Colombia,  96 ;  Guatemala,  118 ;  Haiti,  124 ;  Paraguay, 
148. 

Recommendation  for  adoption  of 14,  58,  60 

Transportation  and  communications: 

Argentina,  65-66 ;  Brazil,  82-83,  85 ;  Chile,  90-91 ;  Ecuador,  109-110 ; 
Guatemala,  115-116;  Haiti,  122-123;  Honduras,  128-131;  Mexico, 
134-135;  Nicaragua,  140;  Panama,  145-146;  Paraguay,  150-151; 
Peru  (wireless),  156;  Salvador,  157-159 ;  Uruguay,  161 ;  Venezuela, 
164-165. 

Discussion    on 44 

Improvement  of  ocean  and  land  transportation 44,  65 

Resolution  concerning 13, 15,  56-57,  59 

Uniformity  of  legislation : 

Argentina,  68 ;  Brazil,  86-87 ;  Ecuador,  111-112 ;  Guatemala,  117-118 ; 
Haiti,  123-124;  Honduras,  131-132;  Panama,  146-147;  Peru,  156; 
Venezuela,  166. 

Resolution  concerning 14,  57 

Uruguay : 

Conference  committee 38 

Report  of 161-162 

Commercial  arbitration,  161;  distribution  of  descriptive 
pamphlets,  161-162;  increase  in  financial  relations  with 
the  United  States  desired,  101-162;  increased  trade  with 
the  United  States^  161 ;  investment  of  United  States  capital 
and  industrial  skill,  161 ;  transportation  development,  161. 
Vecino,  Dr.  Ricardo: 

Member  of  committee  on  resolutions 56 

Presiding  officer  at  fourth  general  session - —        46 

Venezuela : 

Conference  committee 39 

Report  of 163-168 

Commerce — with  the  United  States,  164;  with  Europe,  164; 
commercial  arbitration,  166,  168 ;  debt,  164 ;  effects  of  the 
war,  163;  greater  study  of  Spanish  language,  167-168; 
metric  system,  167 ;  public  finance,  164 ;  recommendations, 
168;  silver,  166-167;  transportation,  164-165;  uniform 
legislation,  166. 


176  INDEX. 

War,  effects  of:  Page. 

Bolivia,  69;  Brazil.  74-76;  Colombia,  93-95;  Cuba,  100;  Ecuador, 
107-108,  109-110 ;  Guatemala,  113 ;  Haiti,  120-121 ;  Honduras,  125- 
126,  128-131 ;  Mexico,  134 ;  Nicaragua,  140 ;  Venezuela,  163. 

Warburg,  Hon.  Paul  M.,  address 47 

Webb  law 16,45 

Weights  and  measures : 

Resolution  on 15,  58 

Venezuela 167 

Wireless  communication : 

Bolivia,  72;  Colombia,  96;  Peru,  156.     (See  also  Transportation  and 

communications. ) 
Zuberbuhler,  Mr.  Luis,  address 45 

o 


